CFA level I: Fixed Income - Super Simplyfied Modified Duration Explained

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We love what we do, and we make awesome video lectures for CFA and FRM exams. Our Video Lectures are comprehensive, easy to understand and most importantly, fun to study with!
This Video lecture was recorded by our Lead Trainer for CFA, Mr. Utkarsh Jain, during one of his live Session in Pune (India).
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[@mphonyana4715]

From the depths of soul... THANK YOU. A week and a half before exams and I finally get this.

[@vinayakgoyal5378]

he is such a smart teacher......he knows how to teach the concepts is a super easy manner......hats off to u sir.....

[@nileshdeshpande172]

Hand of Art will take it to different level.... I am praying 🙏

[@sumitab29]

The explanation is quite mechanical just getting the answer faster. No intuition about why is it called duration and not anything else. In simpler words, it is how long you to wait for returns. So, a 0 coupon bond pays on average much later than a 10% coupon bond. So, 10% coupon bond has a lower duration. Now if interest rates are expected to increase than coupons coming from a 10% coupon can be reinvested at a relatively higher rate. So, though in increasing interest rates environment, prices would decline for both bonds, price decline would be much lower for 10% coupon than a 0 coupon bond. That is what exactly duration is. Maybe this is what ailing our education, just getting to answer without any care for understanding the intuition.

[@HiteshGulati]

I agree. I came here to refresh my memory of what duration actually means. Your comment gave me more insights than this 14 mins long video. An an optimist I am believing that the lecturer explained the concept of duration earlier in the class and this piece is only where he explains how to calculate it. But again they should have put the title appropriately.

[@Sunil-ne8mx]

I am going to find you, join your classes and clear levels 2, and 3! Thank you.

[@smitmehta8914]

Easily the best explanation!!

[@Bonginhlanhla]

What did he man by that?

[@avinashsingh2248]

wow, your concepts are hitting brain directly.

[@FintreeIndia]

Glad you liked it!

[@marcelov7073]

You're the best man!

[@MikitoMichael]

Please, fod god's sake, do a short video explaining and comparing 3 types of durations (Macaulay, Modified, Effective) once and for all. Thank you.

[@Smurfman3041]

Wow! Nice job explaining!!!

[@nileshdeshpande172]

Godly Simplification....

[@mohamadrizal6598]

a super thank you, a very easy-to-understand video.

[@irina-alexandra.constantinescu]

Excellent!

[@isitachatterjee2927]

I know where to take my level 2 classes from !

[@xuepan4715]

thanks so much here's the question. if a fm feels int rate is gonna go down, even if he sells the high duration bonds, and buys/keeps low duration bonds, he'd still face a loss, is there anyway he can do to gain? and if he feels the interest rate is gonna go up, can he short his portfolio to make profit? thanks.

[@Tusocalypse]

Well done

[@kritirastogi4953]

Nicely explained

[@sarfarazali8622]

Can someone help me to understand how would we get to know what is current YTM or interest rate in the market where can we check?

[@Bonginhlanhla]

Hi, how does your drawing depict an "african woman", what does that even mean? You made the point at 1:12.

[@blackheart6897]

Are you African?

[@arungautam3454]

He referred to the hair. In anthropological terms, that kind of hair structure is more commonly found within african population. And no, he was not being a racist.

[@ankandas8531]

Change the title from Super Simplified to Super Complexified !!

[@FintreeIndia]

Try to do better. utkarsh

[@akumar234]

Kindly upload a video of "How to calculate Rolling Returns of Mutual Funds in EXCEL taking historical daily data of 10-15 years with a rolling returns window of 7 years". Most of people are already doing that including me, but sat, sun stock market is closed, so in few cases, referring back corresponding 7 year back date, if that day is sat or sun, we have to take next NAV(Net Asset Value or Price) of Monday. So, how to tackle this issue. Usually people delete this data, so total data points reduces and affecting sample size resulting reduced accuracy of result. Your views on the subject means a lot to us. If you can tell your mail id, I can send you sample daily historical data of 15 years of a mutual fund (with NAV Date & NAV). Regards.

[@victorsardon3521]

Is this part of your job?

[@akumar234]

@victorsardon3521 No. Not part of my job. My interest in this subject. I invest in mutual funds.

[@romeshkirpalani848]

This is simplified concept? Really?

[@kokwahtan8577]

You teach too fast. !! Wat the hell is going on!!