Interest Sensitive Stock

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Interest Sensitive Stock

A stock whose value is likely to increase or decrease substantially due to changes in interest rates. Most interest sensitive stocks represent publicly-traded companies with high rates of long-term debt. These companies' stocks decrease in value when interest rates rise because the higher cost of borrowing may result in lower profits and dividends. Conversely, their stocks rise on lower interest rates. For this reason, utility companies tend to have interest sensitive stocks.
References in periodicals archive ?
Commercial real estate finance is interest-rate sensitive and longer-term oriented," the Commercial Real Estate Finance Council wrote in a media statement.
Among other interest-rate sensitive stocks, DLF slumped 7.
Despite signs interest-rate sensitive parts of the economy are starting to respond to the interest rate cuts since late 2011, the RBA remains uncertain about the future resources investment and the ability for non-mining activity to strengthen sufficiently, to offset the effects of waning mining investment.
Interest-rate sensitive property, automobile and bank shares were hardest hit.
Interest-rate sensitive sectors, such as utilities, dipped as the jobs data erased expectations the Federal Reserve would ease monetary policy.
With three interest rate rises in the last six months and the threat of another, it looks like we have reached the point where the market is interest-rate sensitive.
With three interest rate rises in the last six months and the looming threat of another, it looks like we have finally reached the point where the market is highly interest-rate sensitive.
To find the gap, the analyst has to examine all the assets and liabilities and determine which ones are interest-rate sensitive.
Last week, the air of increased hawkishness among investors led to a rise in bond yields, and a correction in some of the more interest-rate sensitive high-yielders, such as utilities.
Set against this were generally more favorable conditions in interest-rate sensitive industries such as construction, housing, and related financing institutions.
We are overweighted in interest-rate sensitive stocks like banks.
Companies that have diversified their earnings by maintaining larger percentages of less interest-rate sensitive business lines--group retirement, supplemental health lines, traditional life, fixed indexed annuities--are likely to fare better from a capital and earnings perspective.