Explain : why bonds do not maintain stable long-term price patterns ?

Expert Solution

Bonds do not maintain stable long - term price patterns because

Bonds are very sensitive to interest rate, if interest rate increases bond prices falls if interest rate decreases bond prices rises

There is an inverse relationship between bond price and interest rate.

Interest rate is a factor of supply and demand of credit and it's adversely affect the price of the bond.

jeff jeffy answered 3 years ago

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Explain : why bonds do not maintain stable long-term price patterns ?

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