key rate duration

A measure of duration that calculates effective or empirical duration by changing the market rate for one specific maturity point on the yield curve while holding all other variables constant. May be done as part of a series of calculations that separately and sequentially vary the yields for two or more maturity points on the yield curve. Sets of partial durations for multiple points on the same yield curve will sum to a value that is usually close to the overall effective duration.
Also known as reshaping duration.
Key rate duration is the most common type of partial duration and those terms are often used as synonyms.
See effective duration, empirical duration and partial duration. American Banker Glossary

Financial and business terms. 2012.

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