cash matching strategy

Cash Matching Strategy

The practice of matching returns on a bond portfolio to future capital outlays. That is, a cash matching strategy involves investing in certain securities with a certain expected return so that the investor will be able to pay for future liabilities. The practice is essentially the same as cash flow matching, except it applies exclusively to bond portfolios. See also: Duration matching strategy.

cash matching strategy

A method of assembling a bond portfolio so that cash receipts from coupon and principal payments exactly meet future cash needs. Compare duration matching strategy.