Meaning NEGATIVE CONVEXITY: A bond characteristic such that the price appreciation will be less than the price depreciation for a large change in yield of a given number of basis points. For example, a fixed-rate mortgage may lose value as rates go down because of prepayments
More terms such as Negative convexity in Dictionary N.
- Definition National Bank:
- Examples A commercial bank approved by the U.S. Comptroller of the Currency, which is required to be a member of and purchase stocks in the Federal Reserve System negative convexity definition.
- Definition Negotiable Order Of Withdrawal (NOW):
- Examples Demand deposits that pay interest negative convexity explain.
- Definition Nominal Exchange Rate:
- Examples The actual foreign exchange quotation in contrast to the real exchange rate, which has been adjusted for changes in purchasing power negative convexity what is.
- Definition Net Float:
- Examples Sum of disbursement float and collection float negative convexity meaning.
- Definition Nonsystematic Risk:
- Examples Nonmarket or firm-specific risk factors that can be eliminated by diversification. Also called unique risk or diversifiable risk. Systematic risk refers to risk factors common to the entire economy negative convexity abbreviation.