Finance / July 19, 2018 / Hanna Hunt
Are there months when you feel like all your money goes to making payments on your debt? It sounds like you may have a high debt-to-income ratio (DTI) on your hands. The debt-to-income ratio is a number that expresses the relationship between your total monthly debt and your gross monthly income.
Duration is the weighted average term to maturity of a bonds cash flows and therefore, is a valuable tool in assessing bond price sensitivity to interest rate shocks. It is the most common technique for quantifying this sensitivity and is generally used to approximate changes in the price of the bond for every 100 basis point change in yields(modified duration). As a general rule, the greater the value of duration, the more price volatility results from interest rate movements.
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