Browse Investing

Duration, Convexity, and Rate Risk

Duration, convexity, curve-risk, holding-period, and interest-rate sensitivity terms for fixed income.

Duration, convexity, and rate-risk terms explain how bond prices may change when interest rates, yield curves, and expected holding periods change.

Use this branch when the main risk is price sensitivity to rates rather than only issuer default.

What This Branch Covers

AreaUse it for
Duration Measures and Price SensitivityDuration, modified duration, Macaulay duration, effective duration, dollar duration, key-rate duration, and average life.
Convexity and Yield Curve RiskConvexity, negative convexity, and yield-curve risk.
Holding Period and Treasury Curve ContextAnticipated holding period, interpolated yield curves, and on-the-run Treasury curve context.

Common Mistakes

  • Treating duration as exact rather than an approximation.
  • Ignoring convexity for callable, mortgage-backed, or option-sensitive bonds.
  • Comparing yields without checking rate sensitivity.
  • Assuming a short holding period eliminates market-price risk.

In this section

Choose a subsection first. Deeper term pages live inside each subsection, which keeps large topic hubs readable.

Convexity Risk

Fixed-income terms for convexity, negative convexity, and yield-curve risk.

Duration Measures

Fixed-income terms for average life, duration, dollar duration, effective duration, key-rate duration, Macaulay duration, and modified duration.

Holding Period

Fixed-income terms for anticipated holding periods, interpolated yield curves, and on-the-run Treasury yield curves.

Revised on Sunday, June 21, 2026