Navigating interest rate risk with greater precision

Managing interest rates amid continuous volatility is vital for investors. From government funding and policies to high inflation, powerful factors are affecting rates and concerning investors. How can interest rate risk be managed? Firstly, it can be measured through analysing empirical duration and analytical duration, highlighting the impact of yield changes. But it is vital to go further and analyse individual countries, in the bid to find opportunities and risks. Assessing and understanding the relationship between price and yield, and its convex nature, is also key. Bonds with higher...