Understanding Duration: Time and Finance

Duration is a measure of the amount of time that an event or activity takes to complete. It can be expressed in terms of hours, minutes, seconds, or other units of time.

For example, if a movie lasts for 2 hours and 15 minutes, its duration is 2 hours and 15 minutes. Similarly, if a meeting is scheduled to last for 30 minutes, its duration is 30 minutes.

In the context of finance, duration is also used to describe the sensitivity of the value of a financial instrument to changes in interest rates. A financial instrument with a longer duration is more sensitive to changes in interest rates, meaning that a small change in interest rates can cause a larger change in the instrument's value.

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