Choose the incorrect statement. Holding a zero bond till the maturity is risk-free. Selling a zero...

Choose the incorrect statement.

Holding a zero bond till the maturity is risk-free.

Selling a zero bond earlier than the maturity is risk-free.

Selling a coupon bond earlier than the maturity is risky.

Holding a coupon bond till the maturity is risky.

Solutions

Expert Solution

Option B is answer as it is incorrect

Selling a zero bond earlier than the maturity is risk-free.

There is risk of interest rates going down after selling the zero coupon bond before maturity

jeff jeffy answered 2 years ago

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