Question

An investor holds a corporate bond with a Modified Duration of 6.2 years. If the market interest rates suddenly increase by 50 basis points (0.50%), what is the approximate percentage change in the price of the bond?

A Increase by 3.1%
B Decrease by 3.1%
C Decrease by 6.2%
D Increase by 12.4%
E Decrease by 0.31%
Practice Next

Hey! Ask a query