You had created a bond portfolio last year that had a portfolio duration of 12 years, which was your target date. Today, you revise your portfolio such that it now has a duration of 11 years. You are following a strategy known as

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The strategy being followed in this scenario is dynamic immunization. This involves adjusting the portfolio's duration in response to changes in interest rates to maintain a desired level of immunization. By revising the portfolio to a duration of 11 years, the investor is ensuring that the portfolio is protected against interest rate risk for a period of 11 years. Portfolio matching involves matching the portfolio's cash flows to the investor's liabilities, maturity reduction involves reducing the portfolio's overall maturity, yield reduction involves reducing the portfolio's yield, and call protection involves protecting the portfolio from early redemption through the use of call options.

You Had Created a Bond Portfolio Last Year That Had