Are Gilts set to soar?

hedger

Gilts are alledgedly supposed to soar when interest rates and the stock market go down so are we set for a huge rise?

tradetime

hedger wrote: »

Gilts are alledgedly supposed to soar when interest rates and the stock market go down so are we set for a huge rise?

Can't say I follow them, and I don't currently have data access to them, but I'd be struck by the notion, that wouldn't you be a little late to that party, certainly the US bonds have soared, and are now in bubble territory, so I'd wonder would the question not be, are gilts a short?

Reaper

Likewise I'm not fully up on them but the last I heard the yields on gilts were dire because nervous savers were buying them as a safe haven regardless of the return.

On the downside supply is high as the government is going to have to keep issing more to cover spending.

On the upside I gather some of the quantative easing money is earmarked for buying glits which would push demand and therefore prices up.

On balance though they don't look very apealing to me.

EDIT: I just did a search and found this article which backs me up on both the pros & cons, with the bulls currently having the upper hand.

And here is an article saying buyers are snapping up 3 year gilts despite them paying the lowest yield on record.

tradetime

Reaper wrote: »

Likewise I'm not fully up on them but the last I heard the yields on gilts were dire because nervous savers were buying them as a safe haven regardless of the return.

On the downside supply is high as the government is going to have to keep issing more to cover spending.

On the upside I gather some of the quantative easing money is earmarked for buying glits which would push demand and therefore prices up.

On balance though they don't look very apealing to me.

Similar situation to the US then. So looking for a short entry would likely be more productive than buying near a top.
Not that I'm recommending that right now with the government paddling in the pool, but worth watching, if shorting is feasible.

kingmonkey

Soar would probably be an overstatement.

purch

Gilts are alledgedly supposed to soar

The Price or the Yield ??