GILT EDGED SECURITIES HELP!

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:26AM in AAT student discussion
Hi

I am very confused about gilt edged securities, I have read about them in the book but it didnt make any sense to me. Please can anyone explain it to me in simple terms?

Thanks
:?

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:GILT EDGED SECURITIES HELP!

    Do you know what bonds are? If you do all they are is a bond supplied by the government.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:GILT EDGED SECURITIES HELP!

    sorry, dont know what bonds are either
    :oops:
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:GILT EDGED SECURITIES HELP!

    Well you might need to read up elsewhere.

    Basically if a company/government/anyone issues a bond they are basically saying you give me X amount of money now and i'll give you a certificate promising to pay you:

    1) annual interest at the rate specified on the certificate.
    2) the nominal (original) amount you lent me at a date specified on the certifiate.

    There are lots of variations and things but this is the basics. Basically bonds are just a type of loan, like debentures (if you know what they are).

    Info on guilts:
    http://en.wikipedia.org/wiki/Gilts

    Info on bonds:
    http://en.wikipedia.org/wiki/Bond_(finance)

    Heavy reading however, the folks on Wikipedia do like to sound academic!

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