Back up

Definition:

(1) When bond yields rise and prices fall, the market is said to back up. (2) An investor who swaps out of one security into another of shorter current maturity is said to back up.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Irrational call option

The implied call imbedded in a MBS. Irrational because the call is sometimes not exercised when it is in the money (interest rates are below the threshold to refinance), and sometimes exercised when... Read More

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