I earn more than 1,000 euro-proiezionidiborsa.it
Fixed income today generally allows you to limit losses with respect to the final balance of those who decide they want to remain liquid. One could argue that it is ‘a small thing’, but in the meantime it is an important barrier against the devastating damage caused by the high cost of living. Without taking into account that the current account is, in most cases, an expensive instrument.
The rise in yields started in 2022 seems to be confirmed also in this beginning of New Year. A change of scenery that has changed the cards on the table in terms of investments for many savers. Liquidityindeed, today more than ever it reveals itself to be expensive andmostly, loser. How to get out of the impasse?
Gross, net and relative yield
First of all we need to put some dots on the i’s. This is the case, for example, with the concept of gross, net and real returns.
The first refers to the gain offered by a given investment instrument before taxes are paid. In fact, by subtracting the withholding taxes (and the commissions to the intermediary on duty) we obtain the net profit.
However, to get the real one we must also subtract inflation, i.e. the loss of purchasing power linked to the general rise in prices. If we consider the monstrous levels of 2022 and the less reassuring ones of 2023, we understand very well that these are often negative real returns.
I earn more than 1,000 euros net if I move 20,000 euros here and keep the bond until maturity
A second clarification pertains precisely toideal time horizon for an investment.
It must be considered that even inflation thrives on excesses, both upwards and downwards, therefore it would be good to invest in the medium term (at least). That way it should at least try to keep the purchasing power of capital unchanged. Notwithstanding, of course, that the ultimate goal of every investor is always to achieve a positive real gain.
In fact, in addition to defending the real value of the capital, a fair premium is also sought for the risk taken with the choice of a given investment.
Time projection of the investment-proiezionidiborsa.it
The BTP with a 2-year maturity
We take now into account a government bond maturing in approximately 24 months (February 1, 2025, residual maturity: 2.04 years). We are talking about the bond with code ISIN IT0005386245 and gross annual coupon of 0.35% (net 0.30625%).
The ex-dividend dates are February 1st and August 1st, but the real yield of the stock lies in its current price below one hundred. Yesterday the BTP closed the week of trading on the MOT (Electronic State Bond Market) at 94.82 cents. Basically, I earn more than 1,000 euros net if I move 20,000 euros here and keep the security in my portfolio until maturity. The annual net effective return is 2.623%to be filed by a span to also include commissions to the intermediary.
Earnings of Btp-proiezionidiborsa.it
It is evident that the bond does not protect capital from the current cost of living, and probably won’t do it in future months of residual life either. In return could be a decent alternative to inertia and to undergo in full losses, direct and indirect, related to preference for liquidity.
