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Yar Kukh
Posted: 28 March 2023 18:02:21(UTC)
#94

Joined: 28/03/2023(UTC)
Posts: 1

Just wondering if there is online guilt calculator that would take the exact maturity date and today's date to calculate returns and pricing of the guilt ? Most of the calculators have maturity dates X months, X years which is not very precise

DOM offers excel calculator in the downloads section that has dividend payment date. I do not think gilts pay any dividends...
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Anthony French
Posted: 19 July 2023 09:04:57(UTC)
#95

Joined: 09/09/2018(UTC)
Posts: 9,141
Advice needed, so TKIA.

If I bought 10k of Treasury 2025, I understand I would make a very
small capital loss but the yield is 5.12%.
The next coupon is 07/09.
I am trying to replicate they yield on a deposit account within
a SIPP account tying the money up for 2 years, is there
anything else I need to consider ?
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bingo
Posted: 20 July 2023 07:13:02(UTC)
#96

Joined: 28/10/2019(UTC)
Posts: 118
Anthony French;273700 wrote:
I am trying to replicate they yield on a deposit account within
a SIPP account tying the money up for 2 years


How are you holding SIPP money in a deposit account ? Does your SIPP provider support that ? Any details ?

At the moment I'm holding low yielding Gilts in a non tax wrapped account (HL) with a view to "enjoying" capital gains free returns which should, in theory, provide a higher return than the taxed interest on my 1 year fixed deposit accounts.
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Anthony French
Posted: 20 July 2023 07:16:29(UTC)
#97

Joined: 09/09/2018(UTC)
Posts: 9,141
AJ Bell offers 6% on a deposit account but it's a stand alone
account and u can't transfer funds from your SIPP into it.
I am trying to replicate a deposit account but am willing
to accept 5% from a gilt.
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1 user thanked Anthony French for this post.
Andrew1952 on 22/07/2023(UTC)
mdss68
Posted: 20 July 2023 07:49:35(UTC)
#98

Joined: 20/09/2018(UTC)
Posts: 1,975
Anthony French;273824 wrote:
AJ Bell offers 6% on a deposit account but it's a stand alone
account and u can't transfer funds from your SIPP into it.
I am trying to replicate a deposit account but am willing
to accept 5% from a gilt.



The easiest way, albeit one that will trickle upwards daily rather than gain you 3% in a single afternoon, might be one of the Short Term Money Market funds. They should approximately track the UK SONIA rate, which is currently 4.93% (if the BOE keep their foot on the gas, that might yet increase, but equally, at some point rates will drop back again). But for now, they are doing a job. Almost instant access. No issues holding in a SIPP (it's where mine live).

There are some threads around Gilts, and Harry Trout's Portfolio thread has a record of his dealings in Gilts iirc.
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Anthony French
Posted: 20 July 2023 07:54:28(UTC)
#101

Joined: 09/09/2018(UTC)
Posts: 9,141
Tks, but I think in 2 years time interest rates will be lower but
not as low as recent lows, so I want to lock in a 5%
rate of return, for two years and forget about it.
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Anthony French
Posted: 20 July 2023 08:02:50(UTC)
#102

Joined: 09/09/2018(UTC)
Posts: 9,141
I've been directed to your thread,
I want to buy TR25 5% Treasury 2025
yielding just under 5%.
I understand that I will make a small capital loss
after costs but I want to lock down some money
for 2 years.
Is there anything else I need to consider.
TKIA
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bingo
Posted: 20 July 2023 08:42:15(UTC)
#99

Joined: 28/10/2019(UTC)
Posts: 118
Anthony French;273824 wrote:
AJ Bell offers 6% on a deposit account but it's a stand alone
account and u can't transfer funds from your SIPP into it.
I am trying to replicate a deposit account but am willing
to accept 5% from a gilt.



Ah, I'd assumed you meant the gilts themselves were replicating a deposit account. Will be interesting to follow what you end up doing, i've found no way to replicate two year fixed term deposit(s) with associated protection inside a SIPP.
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SSJ
Posted: 20 July 2023 09:45:52(UTC)
#100

Joined: 13/09/2010(UTC)
Posts: 512

Thanks: 1073 times
Was thanked: 1025 time(s) in 397 post(s)
bingo;273833 wrote:
Anthony French;273824 wrote:
AJ Bell offers 6% on a deposit account but it's a stand alone
account and u can't transfer funds from your SIPP into it.
I am trying to replicate a deposit account but am willing
to accept 5% from a gilt.



Ah, I'd assumed you meant the gilts themselves were replicating a deposit account. Will be interesting to follow what you end up doing, i've found no way to replicate two year fixed term deposit(s) with associated protection inside a SIPP.

He does mean that the "gilts themselves were replicating a deposit account"!
He's proposing to buy TR25 with a 5% coupon, currently priced close to par. He plans to get the 5% "interest" up front, tax free in a SIPP - rather like a 20 month fixed-rate deposit account, but a whole lot easier to arrange from within a SIPP. Like a fixed-rate deposit account, there might be a cost in closing it early; unlike a fixed rate-deposit account, there might be a profit in closing early. As long as you are prepared to hold to maturity, the returns are entirely predictable and guaranteed.

I've bought similar high-coupon Gilts in tax wrappers, though I was locking-in for longer than I could get with a fixed-rate deposit account.
To answer the OP's question, bear in mind that the price you will pay when buying TR25 will include the proportion of the upcoming 7th Sep 6-monthly coupon that has accumulated since 7th March. Nothing is free!
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1 user thanked SSJ for this post.
Anthony French on 20/07/2023(UTC)
Anthony French
Posted: 20 July 2023 10:14:22(UTC)
#103

Joined: 09/09/2018(UTC)
Posts: 9,141
Tks, the current cost if I bought 9000 of TR25 shares would be £9,019..00
plus the dealing cost.
I've convinced myself to buy, it will be a couple of weeks as
I haven't got the total amount I want to invest.
With the the threat of another bank rise I hope the price
will not alter much.
Income yield 5.01%
Gross redemption yield 4.86%
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1 user thanked Anthony French for this post.
Andrew1952 on 22/07/2023(UTC)
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