The Importance and Application of Bonds in the Stock Market
DOI:
https://doi.org/10.54691/bcpbm.v30i.2475Keywords:
Finance risk, Indicator, Duration, Convexity, Bond.Abstract
The bond market plays a role in predicting the economy and making portfolio selection for investors. More information can be obtained by analyzing the yield curve. Based on this, this paper mainly describes the role of the bond market and related measurement and analysis methods in detail. This article choose the relationship between the US benchmark interest rate and the yield of the US 10-year Treasury bond, as well as the relationship between the yield of the US 10-year Treasury bond and its price to analyze interest rate risk. Meanwhile, by quantifying the elements in the portfolio and comparing the data, this paper expounds the management and impact of duration, continuity and cash flow matching on the risk of bond market investment. The results shown that the bond market has the function of forecasting and giving investors more choices, and for the risk strategy, the use of a variety of methods will help to reduce risks and increase returns. These help people regard the bond market more effectively and clearly.
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