TREASURY 5.375% 31/01/2056 (T56)

FIREDreamer

Anyone tempted to lock in this seemingly high yield?

I will be over 90 when it matures. 🤣🤣🤣

masonic

You can get a YTM of 5% locking in for as little as 14 years. Who knows where inflation is headed in the long term. I did buy up some fairly long duration gilts back in mid-January when yields were high, but ended up selling for close to a years worth of interest as a capital gain. They've dipped to the same sort of level a couple of times since, and look like they might be heading there again, but I don't think I'll bite, as I'm no longer optimistic about them not falling further.

Johnjdc

masonic said:

You can get a YTM of 5% locking in for as little as 14 years. Who knows where inflation is headed in the long term. I did buy up some fairly long duration gilts back in mid-January when yields were high, but ended up selling for close to a years worth of interest as a capital gain. They've dipped to the same sort of level a couple of times since, and look like they might be heading there again, but I don't think I'll bite, as I'm no longer optimistic about them not falling further.

For that reason, and the tax advantages, at that maturity I'd be more interested in TR56, currently returning effectively RPI+2.3%...