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Rioja - Mock B Q4 - Structural Analysis
Priorat states: Structural analysis of corporate bonds is an important part of active management. Credit bullets in conjunction with long end treasury structures are used in a barbell strategy. Callable bonds provide a spread premium that can be valuable to an investor during periods of high interest rate volatility. Put structures will provide investors with some protection in the event that interest rate rise sharply but not if the issuer has an unexpected credit event.
Q: Priorat is most likely correct with regard to which structural trade:
Bullets. I choose putables. Why is putables wrong?