One term structure theory is based on the idea that some investors (such as savings banks) prefer shorter maturities, while others (such as pension funds) prefer longer maturities. This theory is:_________

Respuesta :

Answer:

Market segmentation theory

Explanation:

The market segmentation theory groups short term securities and long term securities separately, and that they are not related to one another.

Investors tend to remain in the market segments they are familiar with.

For example as savings banks prefer short term loans, while insurance companies and pension administrators prefer long term securities such as bonds.