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What Is Bond Convexity: Explanation and Importance

By Kristi Waterworth – Nov 2, 2024 at 11:10AM

Key Points

  • Bonds can offer fixed income but their values on the secondary market can fluctuate.
  • Bond convexity measures price sensitivity to interest rate changes, impacting value.
  • Understanding convexity aids in deciding when to sell bonds before maturity.
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