Business and Personal Finance Dictionary

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• CUBIC SPLINE
  
  A mathematical technique used for yield curve smoothing. A cubic spline fits a different third degree polynomial to each interval between data points (0 to 1 years, 1 to 2 years, 2 to 3 years, etc.) Either yields or prices can be smoothed using cubic splines. This smoothing technique is the most common and works well for spot rates. See smoothing.
  
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