Which of the following is a risk when owning bonds? Select one: a. all the answers...

Which of the following is a risk when owning bonds?

Select one:

a. all the answers are correct

b. b. price risk

c. c. reinvestment risk

d. a. default risk

e. answers a. and b. only are correct

Solutions

Expert Solution

All are the risks when owning the bond

price risk is the risk of price falling due to rise in rates
reinvestment risk is the risk of reinvesting coupons received at lower rate than expected
default risk is the risk of not getting promised cash flows

jeff jeffy answered 1 year ago

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