Gilts
UK government bonds; low-risk investment paying interest.
Formula
Gilt Yield = (Annual Coupon ÷ Market Price) × 100
Real World
During the 2022 UK mini-budget crisis, gilt yields spiked above 4.5% as investors sold UK government bonds, forcing pension funds to make emergency asset sales and triggering Bank of England intervention.
Exam Focus
Gilts rarely appear in isolation — link them to risk vs. return trade-offs or opportunity cost when evaluating investment decisions.
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