Short bonds in a rising interest rate environment

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In 2022 the Federal Reserve increased interest rates substantially to respond to surging inflation. You are a bond investor and had done quite well during the long period of declining interest rates during the 2010/2021 period. You have been advised to shorten the duration of your portfolio - that long bonds would decline more than short bonds in a rising interest rate environment. Explain this by using an example.

Reference no: EM133215855

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