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It is useful in risk reports because it tells a trader the interest rate risk of each bond in his portfolio. It is true that it is based on an infinitessimal yield curve bump but the difference between this and 1 basis point bump is usually very small and is considered negligible by many. Note that more sophisticated traders do also calculate the dollar ...


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Do you know the concept of duration? It is an approximation of how much the price of the bond changes if the interest rate (appropriate for the market in which the bond trades) changes. This is the interest rate is used to discount cash flows. It is common to all the bonds in the same market (e.g. German govis). For various reasons (liquidity, credit risk, ...



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