Positive Convexity
Positive convexity is a property of fixed-income securities where price increases at an increasing rate as yields fall and decreases at a decreasing rate as yields rise, giving a convex (upward-curving) price-yield relationship.
Example: If yields fall by 25 basis points, a plain-vanilla bond with positive convexity may exhibit a larger price increase than the price decrease associated with a 25 basis point rise.
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