Homework Answers
Value of two zero coupon bonds =2,50,000×2=5,00,000
Maturity amount of first Bond = 250000×1.16=290000
Maturity amount of second Bond= 250000×1.48= 370000
Total maturity Vale of bonds= 6,60,000
Total value of assets after five year = 1.28×5,00,000= 6,40,000
The portfolio is perfectly Redington immunized because the value of bonds will be greater
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