Economics
Duration vs. Maturity
Quick fact
A zero-coupon bond has a duration exactly equal to its maturity, but for coupon-paying bonds, duration is always less than maturity—sometimes significantly less.
Why this is interesting
You buy a 10-year bond, expecting your money back in a decade. But did you know that if interest rates rise just 1%, your bond could lose more value than a 30-year bond with a later maturity? Why would a shorter-term bond be riskier?