单选题 Negative convexity is most likely to be observed in:
  • A. callable bonds.
  • B. zero coupon bonds.
  • C. municipal bonds.
【正确答案】 A
【答案解析】All noncallable bonds exhibit the trait of being positively convex and callable bonds have a negative convexity. Callable bonds have a negative convexity because once the yield falls below a certain point, as yields fall, prices will rise at a decreasing rate, thus giving the curve a negative convex shape.