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The duration method is a financial concept used to measure the sensitivity of a bond's price to changes in interest rates. It quantifies the weighted average time until cash flows are received, helping investors assess the interest rate risk associated with fixed-income securities. There are different types of duration, such as Macaulay duration and modified duration, each serving to inform investment decisions and portfolio management strategies. By understanding duration, investors can better manage risks and optimize returns in their bond investments.

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