Buy and hold - passive strategy, Financial Management

A simple passive strategy involves building a portfolio and holding it through time. The coupons as well as the proceeds of matured bonds are just reinvested in new issues. Generally, some control exists on the level of risk. The most common type of control is to set the duration of the bond portfolio equal to the duration of the relevant index. In this way, interest rate risk can be controlled.

Posted Date: 9/11/2012 2:07:53 AM | Location : United States







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