QUICK DEFINITION
Macaulay Duration is the weighted-average time required to receive a bond's contractual cash flows, using present values as weights.
WHY IT MATTERS
Why Macaulay Duration matters in bond markets
It provides the foundation for modified duration and links a bond's cash-flow timing to rate sensitivity.
MARKET CONTEXT
How to think about it
Bond investors use macaulay duration as part of a wider framework that links prices, yields, cash flows, liquidity and risk. The concept should therefore be read together with its related terms rather than as an isolated definition.
Is Macaulay Duration important for fixed-income investors?
← Back to the Bond Market Glossary Yes. It provides the foundation for modified duration and links a bond's cash-flow timing to rate sensitivity.