Thanks for insights. Yes, GSecs are very tricky.
Yes. I totally agree. Thats why I have stayed away from them for so long. I guess GILT funds gives exposure to these securities. Only drawback is small expenses that we have to forego. But its still better than getting stuck on a wrong security.
I have similar observation. Infact I feel same happens with SGB. I See listed SGB are traded around 4700 to 4800, whereas the new ones are issued at 5000. The ones listed also includes the interest accrued from the last time interest was paid. Theoretically speaking they should have traded above the current market price of Gold. If one holds till maturity, the yield on these is.much higher and the arbitrager would have exploited this opportunity. There has to be something which I am missing out. I am not getting enough time to do my research. If you have any insights on this, please share.
3 Likes