All else equal, the greater a security's coupon, the lower the security's price sensitivity to a change in interest rate.

Name: All else equal, the greater a security's coupon, the lower the security's price sensitivity to a change in interest rate.
Brand: Quizplus
Rating: 4.9 (57 reviews)

Question

Quizplus · Accepted Answer

A higher coupon means more cash flows are received earlier, reducing the duration and interest rate risk, thus lowering price sensitivity to interest rate changes.

All Else Equal, the Greater a Security's Coupon, the Lower