maturity

maturity
The date when a security is due to be redeemed. The further any security is from maturity, the more its market value is liable to fluctuate if there are changes in the rate of interest; the nearer to maturity, the more stable its market price. For example, if the rate of interest is 5 per cent, a security paying £5 at the end of each year with a redemption value of £100 is worth £100 whatever its maturity. If the rate of interest rises to 6 per cent, a security with 1 year to maturity falls in price by 0.94 per cent; with 5 years to maturity, it falls by 4.21 per cent; with 15 years to maturity it falls by 9.71 per cent; and a perpetuity, with no redemption date, falls by 16.67 per cent.