Question

Immunization is not a strictly passive strategy because __________. Group of answer choices B. there is likely to be a gap between the values of assets and liabilities in most portfolios A. it requires choosing an asset portfolio that matches an index D. durations of assets and liabilities fall at the same rate C. it requires frequent rebalancing as maturities and interest rates change

Answer 1

C. it requires frequent rebalancing as maturities and interest rates change

Step-by-step explanation:

Immunization strategy involves mitigation of the risk and it does so by matching the asset and liability against the changes in the interest rates.

The strategy is not passive as this is done by continuous rebalancing as maturities and interest rates change.