In order to gain protection from non parallel twist and shifts - do we take bullet or Ladder? Initially I thought it was bullet but someone countered with non parallel shift won’t offer enough protection from Bullet.
Can anyone elaborate?
Is this a standalone portfolio, or is it meant to immunize a set of liabilities?
It is a portfolio.
Meaning standalone?
If so, a bullet structure is protected against twists; a ladder (and, for that matter, a barbell) is not.
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Thanks. The only explanation given is Ladder “diversifies”, not entirely sure I get their rationale.
It diversifies one’s interest rate risk by spreading it out amongst a number of maturities, rather than concentrating it at a single maturity (or a small set of maturities).
It does not explain how that better than bullet when non parallel twist are involved.
It might be, and it might not be.
A ladder is likely worse under a bear steepening or a bear flattening, but better under a bull steepening or a bull flattening.
thanks too
Correct my understanding here. I have doubts with your statement:
Barbell will be better at bull flattening (depending on duration but since invested at higher end, barbell will be good)
Bear steep: both will underperform but ladder will underperform less, so ladder is good to go.
Bear flattening: Barbell is better, since duration of investing in lower end bonds= less. = Underperform less
Let me know where I am getting it wrong.
Thanks for the help.
We’re comparing a bullet to a ladder, not a barbell.
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Oh yeah. My bad. Was confused. Sorry.
These are confusing times, even without studying for this blasted test.
Ftx and tech layoffs. Also not to mention my impending busy season.
Taxes?
Advisory
Similar idea: year-end tax dodg . . . er . . . strategies. 
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