The Importance of Macaulay’s Duration, Lecture 022, Securities Investment 101

by Andy Duncan on 29/11/2013

In this lecture we discuss the importance of Macaulay’s Duration, particularly to anyone holding large bond portfolios. In passing, we show how and why zero coupon bonds have a duration identical to their maturities, and why the anticipated directional moves of interest rates are so critical to bond traders and pension fund managers.

We also introduce the Excel ‘PV’ (Present Value) function for pricing bonds.

The full YouTube playlist of Securities Investment 101 lecture videos can be found by clicking here.

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