Which of the following investment structures has the least volatility?

Bullet securities are fixed-income investments that pay back the principal at maturity with no interim payments, which makes them less volatile compared to other investment structures. This lack of interim cash flows means that their prices are less sensitive to market interest rate fluctuations over their life. The predictability of cash flows with bullet securities contributes to their reduced volatility, as investors have clarity regarding when they will receive their returns.

In contrast, callable securities may expose investors to higher volatility because they can be redeemed by the issuer before maturity, typically when interest rates fall. This can lead to reinvestment risk and unpredictability in cash flows. Amortizing securities, which pay back both principal and interest throughout the life of the investment, can also introduce variability in cash flows due to the timing of principal repayments.

The statement that all share the same level of risk is inaccurate, as each investment structure responds differently to interest rate changes and other market conditions. Bullet securities, therefore, stand out as the option associated with the least volatility among these choices.