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Q » Explain duration matching in ALM.

Steven

06 Dec, 2025

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A » Duration matching in Asset Liability Management (ALM) involves aligning the duration of assets and liabilities to minimize interest rate risk. By ensuring the cash flows from assets coincide with the timing of liability payments, institutions can stabilize their balance sheets against rate fluctuations. This strategy helps mitigate the impact of interest rate changes on the financial health of the organization, maintaining equilibrium between assets and liabilities over time.

Michael

06 Dec, 2025

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A »Duration matching in Asset Liability Management (ALM) involves aligning the duration of assets with liabilities to mitigate interest rate risk. By matching the duration, financial institutions can ensure that changes in interest rates affect both assets and liabilities similarly, thereby reducing the overall risk and maintaining a stable financial position.

David

06 Dec, 2025

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