PORTFOLIO RISK
Weighted Average Life
Measures average time until principal is repaid.
Formula
WAL = Σ(t × principal repayment_t)/Total principal
Variables: Repayment times; principal amounts
What it means
Measures average time until principal is repaid.
Example
Amortizing principal paid earlier reduces WAL relative to final legal maturity.
How to interpret it
This concept should be read together with its market convention, measurement horizon and underlying instrument. BondStats presents it as an analytical reference rather than investment advice; instrument documentation and primary market rules remain authoritative.
Related Formulas
BondStats reference content is independently written. Mathematical relationships, abbreviations and market conventions are presented for educational and analytical use.