All of the following are one of Malkiel's stated relationships between yield changes and bond prices EXCEPT
A) bond prices move inversely to bond yields.
B) longer-maturity bonds experience larger price changes than shorter-maturity bonds.
C) bond price volatility increases at a diminishing rate as term to maturity increases.
D) bond price movements resulting from equal absolute increases or decreases in yield are symmetrical.
E) bond price volatility is inversely related to the coupon rate.

Question

Quizplus · Accepted Answer

Malkiel stated that bond price movements resulting from equal absolute increases or decreases in yield are not symmetrical; instead, bond prices increase more for a given decrease in yield than they decrease for the same increase in yield. This is due to the convex nature of the price-yield relationship for bonds.

All of the Following Are One of Malkiel's Stated Relationships