If PV01 for a bond portfolio is 2 million that means 0.01% interest rate movement either way will change portfolio price approximately by 2 million. If we set PV01 limit for the portfolio as 2 million that means we are willing to accept 2 million loss for 0.01% rate hike. Suppose the PV01 exposure for the portfolio is almost close to 2 million and on the next day rates move up further, PV01 exposure for the portfolio will come down. PV01 exposure for the portfolio does not indicate whether the next rate hike will make losses. Please explain me how this PV01 limit can be applied to a bond portfolio. Its said that if there is no PV01 limit for a portfolio then the portfolio is not maintained properly.