Gilts and Bonds
Gilts (bonds issued by the UK Government) and bonds are lower risk investments that can help you diversify your portfolio. When you invest in a bond, you lend money to a government or company in exchange for a regular interest payment and the return of your original investment once the bond matures.
- If the issuer experiences financial difficulties, it may struggle to make interest payments or return your money
- Bonds trade on a secondary market after they’re issued. Bond prices are influenced by interest rates and the reputation of the issuer
- Government bonds are not as risky as corporate bonds as a Government is generally considered less likely to default.
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The value of investments can fall as well as rise and you may not get back what you invest. If you’re not sure about investing, seek independent advice.