Learn about the various shifts observed in the yield curve explained with the help of suitable diagrams. Direction of the Yield Curve: A yield curve can have 3 broad directions: 1. Upward Sloping: This is the most common and 'normal' direction of the yield curve. Its interpretation is that bonds with longer maturities have higher yields than those with shorter [...]
The following points highlight the seven main types of risk on investment. The types are: 1. Interest Rate Risk / Market Risk 2. Credit Risk / Counter-Party Risk 3. Call Risk / Prepayment Risk 4. Put Risk 5. Yield Curve Risk 6. Inflation Risk 7. Sovereign Risk. 1. Interest Rate Risk / Market Risk: If we talk of fixed income [...]
List of Top 8 Fixed Income Products! Fixed Income Product # 1. Credit Default Swaps (CDS): Over the past few years, especially at the onset of the global economic recession, when people started to wonder as to what really went wrong, the CDS came into limelight. CDS is basically in the nature of insurance. It provides a protection to the [...]