Fixed Income Strategies

Bond Immunisation

Definition

What is Bond Immunisation?

A strategy matching assets and liabilities so interest-rate changes have limited effect on the ability to meet a future obligation.

Example in practice

A pension fund aligns portfolio duration with the timing of benefit payments.

Keep learning

A portfolio of debt instruments with maturities spread across regular intervals.

A bond strategy concentrated in short and long maturities with little exposure in the middle.

A bond strategy concentrating maturities around one target date.

The complete collection of investments owned by an investor or managed under one mandate.

Think you know your investing terms?

Put your knowledge to the test with a quick quiz.