Immunization

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Dictionary Says

Definition of 'Immunization'

A strategy that matches the durations of assets and liabilities thereby minimizing the impact of interest rates on the net worth.

Also known as "multiperiod immunization".
Investopedia Says

Investopedia explains 'Immunization'

For example, large banks must protect their current net worth, whereas pension funds have the obligation of payments after a number of years. These institutions are both concerned about protecting the future value of their portfolios and therefore have the problem of dealing with uncertain future interest rates. By using an immunization technique, large institutions can protect (immunize) their firm from exposure to interest rate fluctuations. A perfect immunization strategy establishes a virtually zero-risk profile in which interest rate movements have no impact on the value of a firm.

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'Immunization'

  • Immunization Inoculates Against Interest Rate Risk

    http://www.investopedia.com/articles/financial-theory/09/bond-interest-rate-immunization.asp
    Immunization Inoculates Against Interest Rate Risk. January 12 2009 ... rate risk?
    One available strategy is interest rate immunization. (For ...

  • Top 6 Uses For Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/top-bond-uses/expense-matching-immunization.aspx
    ... Find out why in Advantages Of Bonds.). Expense Matching/Immunization. ... Institutions
    also use this strategy on a more complex basis called immunization. ...

  • Top 4 Strategies For Managing A Bond Portfolio

    http://www.investopedia.com/articles/bonds/08/bond-portfolio-strategies.asp
    ... Immunization Bond Strategy This strategy has the characteristics of both active
    and passive strategies. By definition, pure immunization ...

  • Top 6 Uses For Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/top-bond-uses
    ... Find out why in Advantages Of Bonds.). Expense Matching/Immunization. ... Institutions
    also use this strategy on a more complex basis called immunization. ...

  • Top 6 Uses For Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/top-bond-uses/diversification.aspx
    ... Find out why in Advantages Of Bonds.). Expense Matching/Immunization. ... Institutions
    also use this strategy on a more complex basis called immunization. ...

  • Top 6 Uses For Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/top-bond-uses/managing-interest-rate-risk.aspx
    ... Find out why in Advantages Of Bonds.). Expense Matching/Immunization. ... Institutions
    also use this strategy on a more complex basis called immunization. ...

  • Top 6 Uses For Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/top-bond-uses/saving-bonds.aspx
    ... Find out why in Advantages Of Bonds.). Expense Matching/Immunization. ... Institutions
    also use this strategy on a more complex basis called immunization. ...

  • Top 6 Uses For Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/top-bond-uses/long-term-planning.aspx
    ... Find out why in Advantages Of Bonds.). Expense Matching/Immunization. ... Institutions
    also use this strategy on a more complex basis called immunization. ...

  • Top 6 Uses For Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/top-bond-uses/long-term-planning.aspx?lastSlide=1
    ... Find out why in Advantages Of Bonds.). Expense Matching/Immunization. ... Institutions
    also use this strategy on a more complex basis called immunization. ...

  • Top 6 Uses For Bonds

    http://www.investopedia.com/articles/bonds/09/top-uses-bonds-investments.asp
    ... Find out why in Advantages Of Bonds.) 5. Expense Matching/Immunization Individuals
    commonly use bonds to match a future expected cash need. ...

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