UK Bond Market Readies for Retail Investment Rush on Tax Quirk
- Low-coupon, £36 billion gilt first sold in 2021 matures Friday
- Wealthy savers are taking advantage of bonds’ tax treatment
This article is for subscribers only.
Investors are preparing for a flood of retail cash to hit the gilt market after the redemption of a UK bond that has become popular among wealthy Brits looking to lower their tax bill.
The £36 billion ($45 billion) bond maturing Friday has an unusually low coupon and offered higher effective returns than savings accounts for wealthy private investors, thanks to quirk in UK tax policy. It became the most sought-after gilt for retail traders.