A BOT, an "Ordinary Treasury Voucher", is a zero-coupon security, or a security without a coupon, with a duration of less than or equal to 12 months. This BOT has a maturity period of 6 months.
The Italian government issues BOTs through competitive auctions, in which only financial intermediaries that operate on behalf of their clients can participate.
These auctions take place in markets such as in the telematic "obbligazioni" (bond) and in government bond markets.
The average financial duration of BOTs is equal to its residual life, as for every zero coupon security. BOTs can be purchased by contacting a bank, Post Office or Financial Intermediaries. They can be purchased both on the occasion of their issue and on the Stock Exchange, where hundreds of securities are traded every day and where supply and demand meet. They can also be repaid, i.e. the refund value is the nominal value of the security.
BOTs have both advantages and risks, because in the past they have received success among small investors, attracted by the simplicity and ease of calculating the returns (profits). On the other hand, they are forms of investment with a low income. Since the yield rate can reflect Italy's government debt situation, an increase in the rate may precede the economic growth, while its decrease can be seen as an indication of a slowdown.
The chart of the entire available history of the "Italy 6-Month BOT Auction" macroeconomic indicator.
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