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Convexity is a desirable property for bond investors because it means that the bond’s price will increase more when the interest rate falls than it will decrease when the interest rate rises. This creates a cushioning effect that protects the bond’s value from interest rate volatility. Some bonds, such as callable bonds, have negative convexity, …

Bond Convexity Calculator: How to Calculate Bond Convexity: Step by Step Tutorial Read More »

This may sound like it has something to do with where you go on your lunch break, but there is a more reasonable explanation. “Cafe 125” stands for IRS regulation code section 125 regarding tax-free “cafeteria” employee benefit plans. It’s important for employers to work with legal counsel or benefits professionals familiar with Section 125 …

What Is IRC 125 and How Do Cafeteria Plans Work? Read More »