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Joseph Sserwadda's avatar

While I do not disagree with what you say, I would like to make a clarification. Treasury bonds do not compound and accumulate your money to pay it back at the end of term, say 20 years, with original investment plus compound interest earned over those 20 years. Instead, you are paid the interest accumulated I.e coupon payment every end of quarter. There’s currently no mechanism I know of that allows to leave it in the treasury. At the end of the term of the loan, you only earn the original investment whichever way calculated.

I think this clarification helps to bring clarity to those wishing to invest in this product to earn the huge lump sums you mention in your article at the end of term. And it probably is the real reason why some investors think it makes more tangible sense when the amount invested is substantial, as the quarterly coupon payment can then be used to solve cash flow issues or be invested elsewhere. When it’s say 15% of shs.100,000- posted to your account, it’s hard to figure out what next. Thanks

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Andrew Muhimbise Atiki's avatar

Nice.

Thank you for this

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