Gilts
Gilts, sometimes referred to as Government bonds are those used by Government to raise money from large financial institutions like pension funds & from private investors. Money is needed by Government because the Treasury so often finds that its expenses exceed its income. Gilts are sometimes referred to as 'gilt edged securities' or 'bonds' or 'fixed interest securities'. In any event, gilts are issued by Treasury & in nearly all cases, the investor hands over his cash & then receives a fixed rate
of interest for life of gilt. When the gilt matures, its capital value is repaid at par value.Gilts are bought at their par value or at face value. |
|
