Bot, April auction tomorrow. How to buy securities and why it can be convenient
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MILAN – With rates projected towards a decline, Italian savers are trying to seize all the opportunities offered by the market to ensure interesting returns. Tomorrow’s auction needs to be monitored from this point of view, with the Treasury putting it up for sale 8 billion Bots at one year.
What are Bots
Bots are government bonds with a maturity of no more than one year, usually with a maturity of 3,6 or 12 months. They do not guarantee any coupon and the profit is represented by the yield of the security offered at its maturity.
How to buy Bots
The easiest way to purchase Bots is to reserve them through an authorized intermediary ahead of an auction. To do this, for example, you need to have a securities dossier from a bank to another brokerage company. The minimum cut is 1000 euros and the securities can be subscribed for multiples of this amount. In the case of tomorrow’s auction the booking deadline is 11am.
How did the last auctions go?
Overall, short-term securities continue to offer very attractive returns. The auction of February 9th saw 9 billion euros of securities on sale with an offered yield of 3.521%. The March 12 the Treasury placed 7.5 billion in securities with a yield of 3.546%.
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How Bots are Taxed
What also makes short-term government bonds attractive is the preferential tax regime enjoyed by government bonds. These instruments are in fact taxed at 12.5% on the return, while all other financial instruments are taxed at 26%.
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