As Treasury Certificates work ~ Meaning Articles

As Treasury Certificates work

In times of economic crisis, the need arises to think of ways to try to ensure a stable and future income. Published in the Official Gazette the Resolution of the Cabinet n.ยบ40 / 2010, June 11, 2010, the Treasury Certificates began to be sold in July last year.
This public debt instrument created by the Portuguese Government, it is only intended for private and holds a period of 10 years.


Since it emerged this form of profit it has been generated a lot of interest because it is a form of risk-capital investment which in the medium and long term, the investor can enjoy much more attractive interest rates in relation to time deposits or Savings Certificates. That is, give the best of what the public debt has to offer: the yield of Treasury bonds and the liquidity of savings certificates.

The deadline to invest capital is 10 years (maximum), and to think about investing for less than five years, the benefits have not become so clear.

In relation to costs, each certificate will cost € 1. However, the minimum purchase licenses is 1000, or 1000 €, wherein the individual is a maximum value of a million. So, to really get serious benefits to apply this minimum amount, we advise the reader to think if you do not need the amount, at least for the next five years, because only from there be able to take a higher profit margin.

If you happen to have any problem, and want to redeem the invested amount, the money initially invested will not be lost. Ie can recover the money at least six months after having made the subscription. And making the total or partial redemption out of the interest payment date, will forfeit the remuneration he would receive from the payment of interest and raising money. That is, giving the example of an investment of € 1000 to five years, you can earn interest on about 150 € with the Treasury Certificates; while with the savings certificates, with an investment of € 1,000 also at the end of five years simply profited about 67 €.

It should be noted that these values ​​given as an example, not an absolute rule. The prevailing interest rates are directly related to the rates of Treasury Bills or Euribor applied to the subscription date thereof.

Now, for the reader to get a little more elucidated about the gains that can be drawn from this type of investment, step by briefly explain this issue: by the fifth year subscription of Treasury Certificates, the interest is paid according to the rates of tickets Treasury or Euribor 12 months. In the fifth year, the interest is paid taking into account the difference between the remuneration of Treasury Bills or the 12 month Euribor and Treasury bonds to 5 years. After that, and as I said earlier, from the fifth year, the player will begin to notice real profits. Ie after five years with the Treasury Certificates, the interest is paid taking into account the rates of Treasury bonds to 5 years, practiced on the subscription date. Finally, as in the tenth year the interest will be calculated according to the difference between the yield of Treasury bonds to 5 years and the treasury bonds to 10 years.

Where to Buy Treasury Certificates

Now that those interested will be thinking it will be, but where I can purchase these certificates? In order to be able to invest in this application the Portuguese public debt, the reader will have to open an account in the Management Institute for Treasury and Public Credit, better known as IGCP. Although also marketed by CTT, this (IGCP) is the regulatory authority of Treasury Certificates, as well as an entity that offers its acquisition.

If by chance you already have money invested in Savings Certificates, take good care of the pros and cons of transferring the capital for Treasury certificates, because you must be sure that it will keep the investment for more than five years, or the profits will not be more advantageous. For while always get 2% interest with the savings certificates, with this new application of state debt, only earn 1% during the first four years.

In short, contrasting somewhat with the savings certificates, the recent relatively Treasury Certificates only not become more profitable to apply them for 3 or 4 years. Moreover, this form of capital investment proves to be an excellent alternative to all citizens who have a minimum of 1,000 euros to apply.


Treasury Certificates, a chance to become millionaire!

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