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Exam Code: C1000-091

Exam Name: IBM Cloud Pak for Automation v19.0.3 Administration

Certification Provider: IBM

Related Certification: IBM Cloud Pak for Automation v19.0.3 Administration

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NEW QUESTION: 1
Anna List, a portfolio manager, wishes to construct a portfolio of bonds which will exhibit very little market value sensitivity to changes in interest rates. Which of the following strategies would be consistent with this desire?
A. She should purchase a wide variety of bonds with exposure to as many maturities as possible. It will also help if she can get a good mix of both high coupon bonds with equal weighting in low or zero-coupon bonds.
B. She should purchase as many zero-coupon bonds as possible.
C. She should purchase high coupon bonds with short maturities.
Answer: C
Explanation:
When all other factors are constant, bonds with short maturities and relatively high coupons will be less sensitive to changes in interest rates. Thus, zero-coupon bonds tend to be the most price-sensitive when rates change.


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