Market players averse to conversion of short-tenor G-Secs into long-tenor G-Secs
April 20, 2021 They fear that a rise in interest rates could adversely impact prices of long-tenor securities Market participants, especially banks, in the Government Securities (G-Sec) market, seem to be turning averse to the conversion of short-tenor securitiesinto long-tenor securities, due to fears that a rise in interest rates could adversely impact prices of the latter. They are avoiding duration risk (the longer the maturity of a bond, the more sensitive it is to changes in interest rates), going by the results of the switch/ conversion auction of 10 G-Secs (for a notified amount of ...