8. The use of duration as a measure of interest rate risk when investing in a single bond market has merits; however, such a measure of duration in a portfolio of international bonds is not relevant. A simultaneous and identical parallel shift in interest rates in each of the countries in which the portfolio manager has invested would be necessary for the duration metric to be properly applied. As a result, an overall duration measure in an international bond portfolio is not applicable.

9. In the international bond management business, however, absolute return is gaining in prominence as a performance measure, particularly when overall interest rates are at low levels.

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