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Gilt

Meaning: 

A Gilt is defined as a government security (bond) issued by the Government of India. They are regarded as one of the safest investment instruments since they are backed by the central government. In essence, a Gilt is a government bond that offers a safe, fixed income with low risk.

Example:
For example, if an investor purchases a Gilt worth ₹1,00,000, they will receive regular interest payments and the full amount back at maturity.


How to understand Gilts:

Gilts are ideal for conservative investors and institutions looking for stable returns.
The yields on Gilts serve as indicators for the overall interest rate structure in the economy.

Uses of Gilts: 
Investors use gilts to protect their capital, manage liquidity, and hedge against interest rate risks.