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yields on index linked gilts
imasavernow
Posts: 3 Newbie
Hi
I would like some help on understanding index linked gilt yields. At present the gross redemption yield on 2.5% IL 2013 is shown as 3.06%. What does this mean? My understanding is that the assumed rate of inflation is 3% so does this mean a real yield of only 0.06%? Or is this the redemption yield on the capital only and the interest is separate?
Or could it be that the GRY is 3.06% +3% =6.6% ( I wish!)
I would like some help on understanding index linked gilt yields. At present the gross redemption yield on 2.5% IL 2013 is shown as 3.06%. What does this mean? My understanding is that the assumed rate of inflation is 3% so does this mean a real yield of only 0.06%? Or is this the redemption yield on the capital only and the interest is separate?
Or could it be that the GRY is 3.06% +3% =6.6% ( I wish!)
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