What Are Gilt Funds?

Gilt Funds

Gilt funds invest in only treasury Bills and government securities, which do not have a credit risk (i.e. the risk that the issuer of the security defaults). These securities pay a lower coupon or interest to reflect the low risk of default associated with them.

Long-term gilt funds invest in government securities of medium and long-term maturities. There is no risk of default and liquidity is considerably higher in the case of government securities. However, prices of long-term government securities are very sensitive to interest rate changes.

Also, Read about Open-Ended & Close Ended Mutual Funds.

Gurpreet Saluja

Hi, I’m Managing Director at Gurpreet Saluja Financial Services Pvt. Ltd. Where I help my investors to invest in mutual funds and achieve their financial goals. I’m also a Value Investor and here I write about Personal Finance & Investing.

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