In investment terminology the expression "gilt edged securities" is frequently used by investors, bankers and financial analysts. Gilt edged securities refer to which of the following types of securities?

Introduction / Context:
This question belongs to basic investment and banking awareness. The term "gilt edged securities" appears often in discussions about safe investments and government borrowing. Understanding what exactly counts as a gilt edged security helps you interpret economic news and answer finance related MCQs correctly.

Given Data / Assumptions:

• The expression under discussion is "gilt edged securities".
• The context is investment terminology used by investors and financial institutions.
• The options refer to securities issued by different kinds of issuers: government, multinational companies, private sector firms, joint ventures and cooperatives.
• Only one option matches the standard definition used in finance.

Concept / Approach:
The word "gilt" originally referred to the gold edging on British government securities, which symbolised high credit quality and safety. In modern usage, gilt edged securities are high grade bonds issued by the government, considered to have very low default risk. In the Indian context, government securities issued by the central or state governments are commonly called gilts. Securities issued by private companies, even large ones, carry higher risk and are not classified as gilt edged.

Step-by-Step Solution:
Step 1: Recall that gilts are associated historically with government borrowing in markets like the United Kingdom and later other countries. Step 2: Understand that government securities are backed by the taxing power and credit of the government, making them relatively safe. Step 3: Review the options and identify "Securities issued by the Government" as the one that fits this description. Step 4: Recognise that securities issued by multinational or private companies do not enjoy the same guaranteed status as government bonds. Step 5: Select the option that links gilt edged securities specifically with government issued securities.

Verification / Alternative check:
Finance textbooks and RBI publications use the term government securities, often abbreviated as G Secs, and describe them as gilt edged instruments. Mutual fund fact sheets for gilt funds also explain that they invest primarily in government securities. These consistent references across multiple financial sources confirm that gilt edged securities are those issued by the government.

Why Other Options Are Wrong:
Securities issued by multinational companies may be high quality but still carry corporate credit risk and are not called gilts in standard terminology.
Securities issued by private sector companies, whether large or small, fall under corporate bonds or debentures and are not automatically gilt edged.
Securities issued by joint venture companies combine risks of multiple partners and again do not match the traditional meaning of gilt edged securities.
Securities issued by cooperative societies can be even riskier and are not regarded as gilt edged by financial markets.

Common Pitfalls:
A common pitfall is to assume that any safe looking company or a famous multinational automatically issues gilt edged securities. Another mistake is to interpret "gilt edged" simply as "high quality" without understanding that, in exam context, it is tied specifically to government issued instruments. To avoid confusion, remember that in India and many other countries, gilts or gilt edged securities are government bonds, and that mutual funds called gilt funds invest primarily in such government securities.

Final Answer:
Gilt edged securities are securities issued by the Government, generally considered to be very safe investments with low default risk.