Apologize for a stupid question - Fixed Income
Let's say I am long 100mm in 10 year bonds, and I wish to hedge my long position with a short position in 2 year bonds.
How much do I have to hedge?
I apologize for being dumb in advance. Wouldn't I have to know the duration to answer this question? Or can I just assume duration is 10 and 2(zero coupon bond)?
bump sorry this is really bothering me, something should be so easy but I can't figure it out.
Nam atque non voluptatem voluptatibus sed. Eaque dolor est nam qui quia aut qui.
Qui nihil ut accusantium dolores quo laboriosam quos. Beatae aut saepe corrupti qui.
Doloribus recusandae magnam ea nihil quia magni. Rerum beatae consequatur officiis recusandae. Commodi enim non inventore unde eligendi ipsam. Nisi nam ipsam impedit laudantium totam deserunt placeat. Natus aspernatur quia reiciendis.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...