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What is the market value of short position

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Consider a corporate bond with 10 years until maturity, trading at par (M=100,000). The modified duration of this bond is 14.2 periods. Also consider a Treasury bond with 7 years until maturity. The modified duration of the Treasury bond is 11.3 periods. Suppose you want to buy the corporate bond and hedge it with a short position in the Treasury bond, what is the market value of your short position?

Reference no: EM132504403

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