Definition of
ILG
UK bond with payments linked to retail prices index-linked gilt: in the United Kingdom, an inflation-proof government bond, first introduced for institutional investors in 1981 and then made available to the general public in 1982. It is inflation-proof in two ways: the dividend is raised every six months in line with the retail price index and the original capital is repaid in real terms at redemption, when the indexing of the repayment is undertaken. The nominal value of the stock, however, does not increase with inflation. Like other gilts, ILGs are traded on the market. Price changes are principally dependent on investors' changing perceptions of inflation and real yields.
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