BUISENESS MANAGEMENT
RISK MANAGEMENT
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Long Term
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Short Term
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Either A or B
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None of the above
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Detailed explanation-1: -Long-term bonds come with a term to maturity of between 10 years and 30 years. Such bonds generally pay a higher interest rate than short-term and intermediate bonds. Bond issuers are willing to pay a higher interest rate for the bonds in exchange for locking the bond for a longer period of time.
Detailed explanation-2: -While longer-term bonds may lag behind stocks during equity bull markets, they have historically provided higher returns than equities during bear markets, which can help to cushion losses in balanced portfolios. Bond returns are driven by two factors: income and capital gains/losses.
Detailed explanation-3: -Long bond is often a term used to refer to the longest maturity bond offering from the U.S. Treasury, the 30-year Treasury bond. It can also carry over to the traditional bond markets to include the longest-term bond available from an issuer.
Detailed explanation-4: -Bonds and Notes Bonds are long-term securities that mature in 20 or 30 years. Notes are relatively short or medium-term securities that mature in 2, 3, 5, 7, or 10 years. Both bonds and notes pay interest every six months.
Detailed explanation-5: -The 10-year Treasury note is a debt obligation issued by the United States government with a maturity of 10 years upon initial issuance. A 10-year Treasury note pays interest at a fixed rate once every six months and pays the face value to the holder at maturity.