FINANCE Investment Analysis and Portfolio Management CHAPTER 18 QUESTION 7
You expect interest rates to decline over the next six months
a. Given your interest rate outlook, state what kinds of bonds you want in your portfolio in terms of duration and explain your reasoning for this choice.
b. Y ou must make a choice between the following three sets of noncallable bonds. For each set select the bond that would be best for your portfolio given your interest rate outlook and the consequent strategy set forth in Part a. In each case briefly discuss why you selected the bond.
Bonds; Maturity; Coupon; Yield to Maturity
Set 1 ： Bond A 15 years 10% 10%
Bond B 15 years 6% 8%
Set 2 ： Bond C 15 years 6% 10%
Bond D 10 years 8% 10%
Set 3 ： Bond E 12 years 12% 12%
Bond F 15 years 12% 8%
USA 
India