Using a(n) ____ strategy, investors allocate funds evenly to bonds in each of several different maturity classes.

Question

Quizplus · Accepted Answer

The strategy described is known as a laddered bond portfolio, where bonds are purchased with staggered maturity dates. This can provide a balance between generating income from shorter-term bonds and potentially higher returns from longer-term bonds. It also reduces interest rate risk as the portfolio is diversified across different maturity dates. Therefore, the best choice is B.

Using A(n) ____ Strategy, Investors Allocate Funds Evenly to Bonds