Hello and thank you for visiting this disucssion, I am interested in investing in UK GILTS 1)I want to invest 10,000 on UK Gilts 10 Year According to bloomberg, coupon is 4.75% So, 10000*4.75% = 475 I think gilts pay coupons every six months 475*2 = 950 By redemption date.... 950*10= 9500 I will have 9500 profit ? What am i doing wrong here? 2) i am assuiming i must buy it at issue date, is this date and time easily attainable information? Many thanks in advnace
Coupon is annual, if it is paid twice per year than 475/2 not 475X2... 10 years is the maturity of that bond; if that bond was issued in 2018, and you are buying now (2020), you will have 8 years of coupon payments