A trader values off−the−run bonds using interpolated yield to maturity data from on−the−run bonds. How can one profit from this trader's valuation methodology when the yield curve is upward sloping?
A Buy off−the−run bonds with above market coupons from the trader and sell to the trader off−the−run bonds with below market coupons.
B Buy off−the−run bonds with below market coupons from the trader and sell to the trader off−the−run bonds with above market coupons.
C Buy from the trader off−the−run bonds with above and below market coupons.
D Sell to the trader off−the−run bonds with above and below market coupons.
选A，解释没太看懂：
The duration of the off the run bonds with above market coupons is lower than the duration of on the run bonds with the same maturity . In an upward sloping yield curve ,the yield the trader is using to value these bonds is too high, resulting in a price which is too low. One can profit from this pricing error by buying these bonds from the trader. The duration of the off the run bonds with below market coupons is higher than the duration of on the run bonds with the same maturity. In an upward sloping yield curve, the yield the trader is using to value these bonds is too low, resulting in a price which is too high. One can profit from this pricing error by selling these bonds to the trader
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