Jul 15, 2025 · Convexity is the curvature in the relationship between bond prices and bond yields. Convexity demonstrates how the duration of a bond changes as the interest rate changes. If a bond’s …

In finance, bond convexity is a measure of the non-linear relationship of bond prices to changes in interest rates, and is defined as the second derivative of the price of the bond with respect to interest …

Dec 8, 2025 · Convexity measures the non-linear curvature of bond prices, correcting duration for accurate risk management during volatile rate changes.

Convexity, in financial terms, refers to the curvature of the relationship between a bond’s price and its yield. Unlike duration, which measures a bond’s sensitivity to interest rate changes, convexity takes …

Sep 10, 2025 · Bond convexity is a way of explaining the sensitivity of a bond's secondary market price as it moves with changing interest rates. Convexity isn't fixed, and it also isn't linear, so in some...

Convexity measures the sensitivity of the bond’s duration to change its yield. Convexity is a good measure for bond price changes with greater fluctuations in the interest rates.

Apr 29, 2024 · In a nutshell, the convexity of a bond refers to the relationship between bond yields and interest rates. Although not an exact science, if the ‘duration’ on a bond increases and the yield falls, …

Feb 22, 2022 · In simple terms, convexity is a concept that covers the movement in bond prices. The concept of convexity states that the change in bond price when the interest rate decreases are …

Mar 15, 2025 · Explore how bond convexity refines duration-based price estimates, the difference between positive and negative convexity, and how to incorporate these measures into portfolio-level …

Feb 11, 2025 · A bond’s convexity relates to the duration of a bond—the sensitivity of its price to interest rate changes—as interest rates rise and fall. The rate of change in duration with respect to changing …