average maturity

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Average maturity

The average time to maturity of securities held by a mutual fund. Changes in interest rates have greater impact on funds with longer average maturity.

Average Maturity

In a mutual fund containing debt securities, the average amount of time until the debt securities mature. It is calculated by adding together the total amount of time until maturity and dividing by the number of debt securities in the mutual fund. The shorter the average maturity is, the less the fund's share price will fluctuate with changes in interest rates. See also: Weighted average maturity.

average maturity

The average time to maturity of all the debt securities held in a portfolio. A relatively short average maturity results in smaller price fluctuations in response to changes in market rates of interest. A short average maturity subjects the owner of a debt portfolio to the risk that maturing debt will be replaced with debt carrying a lower interest rate. Average maturity is an important consideration for investors who hold bond and money market funds.
References in periodicals archive ?
Average maturities for money funds came down last fall, although perhaps not as sharply as some would have expected, after the industry was shaken by a fund that failed to keep its dollar par value.
Some muni funds hold bonds maturing in a few years while others have average maturities of 10 years, 20 years, or more.
This comprehensive newsletter provides yields, assets, average maturities and portfolio composition statistics for more than 1,800 money-market mutual funds, as well as category averages and insightful commentary.
6% and increase our weighted average maturities from 2.
Lipper defines a Short-Intermediates Municipal Debt fund as a fund that invests in municipal debt issues with dollar-weighted average maturities of one to five years.
Interest rate disclosures would include investment maturity information, such as weighted average maturities or specification identification of the securities.
With the completion of these transactions, the Company's total debt will be approximately 33% of the estimated market value of its assets, will be 99% fixed rate and will have average maturities of 7.

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