Glossary

Gilts are government-issued bonds in the United Kingdom, which are considered low-risk debt securities.

These bonds are issued by the UK Treasury to raise funds for the government's operations and are backed by the credit of the UK government. Investors receive periodic interest payments (called coupons) and get their principal back when the bond reaches its maturity date. 🇬🇧💷

For example, an investor might buy a 10-year UK government gilt with a 2% annual coupon rate, providing a steady income stream and a relatively safe investment.

Fun fact: The term "gilt" originates from the fact that these bonds were initially issued as physical certificates with gilded (gold) edges, signifying their high value and trustworthiness. Today, gilts are mostly held electronically, but the name has stuck. ✨📜