Maturity Risk Premium

Maturity Risk Premium is basically the extra return that an investor demands or gets for bearing the maturity risk. We can say, longer the maturity of a financial instrument, the more is the maturity risk premium it offers.
To know more about it, click on the link given below:
https://efinancemanagement.com/investment-decisions/maturity-risk-premium-meaning-need-and-calculation

1. By:- eFinanceManagement.com https://efinancemanagement.com/investment-decisions/maturity-risk-premium-meaning-need-and-calculation Maturity Risk Premium

2. Introduction Need Maturity Risk Premium & Interest Rate Risk How to calculate? Reference Content

3. Maturity Risk Premium is basically the extra return that an investor demands or gets for bearing the maturity risk. We can say, longer the maturity of a financial instrument, the more is the maturity risk premium it offers. Introduction

4. The need of maturity risk premium arises due to following risk: Default risk Interest rate risk Reinvestment risk Need

5. There is a very close connection between the concept of maturity risk premium and interest rate risk . This risk of the interest rate rising more than the set rate is the interest rate risk . The maturity risk premium helps to offset this risk by raising the interest rates on the securities with longer maturity. Maturity Risk Premium & Interest Rate Risk

6. The formula for calculating maturity risk premium is as follows: Maturity Risk Premium = 10 Year Treasury bill less 1 Year Treasury bill yield How to Calculate?

7. Reference To know more about it, click on the link given below: https://efinancemanagement.com/investment-decisions/maturity-risk-premium-meaning-need-and-calculation