Modified Duration: Formula, Calculation, and How to Use It
May 27, 2025 · Modified duration can tell investors how much the price of a bond is likely to change when interest rates increase or decrease. What Is Modified Duration? Modified duration follows the …
Modified Duration - Definition, Formula, Calculate
What is Modified Duration? Modified duration, a formula commonly used in bond valuations, expresses the change in the value of a security due to a change in interest rates.
Modified Duration | Meaning, Formula, Applications, & Limitations
Nov 22, 2023 · Modified duration is a measure of the sensitivity of a bond's price to changes in interest rates, taking into account the bond's cash flows and time to maturity.
Duration | Top 3 Types (Macaulay, Modified, Effective Duration)
The Mathematical Definition: "Modified Duration is the percentage change in Price of a Bond for a unit change in yield." It measures the price sensitivity of a bond to changing interest rates.
Modified Duration | Brilliant Math & Science Wiki
The modified duration of a bond is the price sensitivity of a bond. It measures the percentage change in price with respect to yield. As such, it gives us a (first order) approximation for the change in price of …
Duration vs. Modified Duration - What's the Difference? | This vs. That
Modified duration is a modified version of duration that adjusts for the bond's yield. It is a more commonly used measure as it provides a better approximation of the bond's price sensitivity to …
Modified Duration: A Simple Explanation - michaelpgoetz.com
Nov 17, 2025 · Modified duration is a way to measure how much the price of a bond is likely to change when interest rates move. Think of it as a sensitivity meter for bond prices.
Understanding Macaulay and Modified Duration: Key ... - Investopedia
Nov 9, 2025 · Modified duration is a bond's price sensitivity to changes in interest rates, which takes the Macaulay duration and adjusts it for the bond's yield to maturity (YTM).
Modified Duration: Meaning, Formula, Examples | The Motley Fool
Nov 19, 2024 · Modified duration is a formula that measures the sensitivity of the valuation change of a security to changes in interest rates. Modified duration is most commonly used with bonds.
Modified Duration: The Modified Duration Approach: Refining Key …
Mar 30, 2025 · Modified duration is a fundamental concept in fixed-income portfolio management, offering a refined measure of a bond's price sensitivity to changes in interest rates.