A reference to the est. marker GiltIQ puts against a projected index-linked coupon, what it means, what it does not mean, and how to tell a scaled figure from a projected one on a cash-flow table.
The marker says the figure is not contractual
An index-linked gilt's coupon is a real coupon multiplied by an index ratio, and the ratio is the reference RPI divided by the base RPI. For a payment already in the past that is arithmetic on two published numbers. For a payment still to come it is not, because the reference RPI for that payment has not been published yet. The gilt's terms specify an amount the holder is entitled to; nobody, including the site, can state it in pounds before the index value exists.
The income estimate marker — written as est. against the figure — is how the site says so. A marked coupon is the site's projection from the information available, not a contractual amount. An unmarked one is arithmetic on published values. Reading the two as though they carried the same weight is the mistake the marker exists to prevent.
Two ways a projection gets its number
A projected index-linked flow has to bridge the gap between the last published index value and the month the gilt's terms point at for that payment. The site bridges it in one of two stated ways, and both are marked, because both are estimates for the same reason.
| Situation | What the projection assumes | Carries a marker |
| The payment's reference RPI is published | Nothing — the ratio is arithmetic on published values | No |
| The reference month is later than the last published index | No further inflation: the real coupon scaled by the latest published ratio | Yes, est. |
| The flow is grown past the last published index | The assumed inflation rate entered for that projection | Yes, est. |
| A flow is discounted at a fitted curve rather than the gilt's own yield | The fitted par or zero-coupon curve at that term | Yes, a separate marker |
The first row is the one a reader should look for before relying on a figure. Everything else on the page is stated as what it is: an estimate from an assumption that the page also states.
The indexation lag decides where the dividing line falls, which is why the markers on a schedule do not all begin at one fixed distance from the reporting date. The reference month for a payment sits some months before the payment itself — eight under the longer lag, three under the shorter — so a coupon due a few months out usually has its governing index value already published, while one due years out does not. Which payments fall on which side of the line is a property of the gilt's terms rather than of how near the payment feels.
What the marker does not mean
A marker is a statement about provenance, not about direction or size. It does not mean the figure is understated, that it is a minimum, or that the amount actually paid will be higher. The Retail Prices Index can fall as well as rise, and the Debt Management Office says plainly that index-linked cash flows can therefore fall. A projection that holds the index flat is a neutral assumption, not a floor.
- It is not a lower bound. A projected coupon is a point estimate from a stated assumption, and the outcome can be below it.
- It is not a forecast of inflation. Where a rate is used it is the assumed inflation the reader or the page supplies, labelled as such.
- It is not an error or a gap in the data. The input genuinely does not exist yet; the projection is the honest alternative to a blank cell.
- It is not specific to coupons. A projected index ratio, a projected redemption and a curve-discounted value can each carry one, for the same reason.
- It is not a reason to ignore the figure. A long-dated projection is useful precisely because it shows what a stated assumption produces over the whole term.
Why an estimate is better than a blank
The alternative to projecting is to show nothing beyond the last published index figure, and that would leave a long-dated gilt's schedule almost empty. What matters is that the reader can tell the two kinds of figure apart and can see the assumption behind the second. Both of those conditions are met by marking the projected rows and naming the assumption on the page, which is why the marker travels with the figure rather than sitting in a footnote.
The distinction also protects a reader who is comparing two gilts. A short-dated index-linked gilt's schedule is mostly arithmetic on facts; a long-dated one's is mostly projection. Comparing their totals without noticing that difference compares two different qualities of number, and the marker is what makes the difference visible.
A marked figure is the site's projection from a stated assumption; an unmarked one is arithmetic on published values. Neither case makes an index-linked gilt's future cash certain.
Where the markers appear
On a gilt's own page the projected cash-flow table carries an index ratio and a flow for every future payment date, with the marker against the rows that need one. The index-linked gilts in issue is the other place a reader meets the arithmetic: its index ratio column is the latest published ratio for each gilt, which is the input a projection starts from.
The gilt coupon calendar applies the same treatment across a window of payments and every gilt in issue, so a reader can see which dated coupons in the period are scaled from published values and which are projected. Its optional after-tax line is a further estimate as well, and its own convention is stated on the page.
Background, not advice
This page is a reference to a marker GiltIQ displays and what it means; it is general background, not investment, tax or legal advice for any reader's circumstances. The Retail Prices Index is published by the Office for National Statistics, and the gilt's terms and indexation lag are described by the Debt Management Office, which are the primary sources for the inputs a projection starts from. No projection here is a promise of cash, and an index-linked gilt's price still moves before maturity.