Co-founder of Affari Miei Independent Financial Advisory Company
September 7, 2023
The second issue of the BTP Valore (the first was in June) scheduled from Monday 2 to Friday 6 October 2023. The title will have a duration of five years and includes an extra final loyalty reward. What are the main features? it suits invest?
We will answer the many questions in this article, read on.
This article talks about:
Characteristics of the BTp Value of October 2023
A significant novelty is the introduction of quarterly coupons, calculated on pre-set rates that increase over time (step-up mechanism).
Performance
The minimum guaranteed rates of return will be communicated on 29 September. In the issue of June 2023the rates were 3.25% for the 1st and 2nd years and 4.00% for the 3rd and 4th years, with an extra final loyalty bonus of 0.5%.
Minimum Investment and Purchase
L’minimum investment is 1,000 euros. The security can be purchased without commission through home banking, at the bank or at the post office. Placement takes place on the Mot platform (electronic bond market).
It will be possible to access independently through your own bank (home banking), by calling or by going to the branch.
Tax treatment
As always there will be taxation facilitated by 12.5%, treatment that concerns all Italian and European government bonds.
Duration
As mentioned at the beginning, the duration of the title will be equal to five years.
Is investing in BTp Valore risky?
We summarize the main ones risks connected in general to the purchase of Italian government bonds; for those wishing to learn more there is also a video contribution in which they are explained in a more analytical way.
Volatility and Interest Rates
The volatility it is a key factor to consider, especially in relation to the duration of your investment. If interest rates rise, the value of BTPs already issued falls; conversely, if rates fall, their value increases.
This means that the performance of the security on the secondary market may also be significantly affected by these variables.
Issuer risk
Another crucial aspect is the issuer riskin this case Italy.
How likely is the country to default or face debt restructuring? Even if this eventuality is remote, it should not be overlooked: it could lead to a partial or total loss of the invested capital.
Is it worth investing in the BTP Valore October 2023? My opinions
We have reached the core of our analysis, so we must try to understand whether or not it is actually worth investing in BTp Value of October 2023.
It seems quite obvious to me that we are currently commenting on half a piece of news: the MEF, in fact, has communicated some features of the new instrument but until 29 September we will not know the performance actual.
Until that date, therefore, we will only talk about hypotheses and it will be objectively difficult to give some serious opinions.
At the moment we just have to wait: this article will be updated in the next few days as we have more information.
I conclude by saying that if you are looking for resources on the subject, here are some articles that may interest you:
If, on the other hand, you are trying to start your investment journey consciously as an independent investor, then I suggest you read more here:
Good continuation!
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