Investor Glossary-treasury inflation-protected securityInvestor Glossary-treasury inflation-protected securityInvestor Glossary-treasury inflation-protected securityInvestor Glossary-treasury inflation-protected securityInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Treasury Inflation-Protected Security

The HTML to link to this page
 

A Treasury Inflation-Protected Security (TIPS) is a U.S. Treasury bond whose interest and redemption payments are tied to inflation. A Treasury Inflation-Protected Security pays a fixed rate of interest, with principal value adjusted semiannually, based on changes in the Consumer Price Index. Consequently, interest payments of a Treasury Inflation-Protected Security may vary. At maturity (5, 10, or 20 years), the Treasury Inflation-Protected Security returns the initial principal to the investor, adjusted for inflation.
Like other Treasury securities, a Treasury Inflation-Protected Security is "backed by the full faith and credit of the United States government" and is exempt from state and local income taxes, but is subject to federal income tax. A gain in principal in a Treasury Inflation-Protected Security is considered reportable income for that year, even though principal is not distributed until the Treasury Inflation-Protected Security matures.



Rate this Treasury Inflation-Protected Security definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: 1035 exchange, phantom income, command economy, diluted share, LIBOR, per diem, ex-dividend date, debt service coverage, cancelled check, Zero Cost Collar, dividends payable, implied volatility, 1031 exchange, labor relations, 144a, covered put, irrevocable trust, class C shares, quality assurance, liquidity ratio, annual return, deferred tax, margin rate, reverse mortgage, deferred revenue, inflation, stock market close, limit order, retained earnings, VIX, current ratio, FTSE, Key Rate Duration, balance sheet, APR, required rate of return, stock split, FICO score, 401a, minority interest, open position, real GDP, option premium, wholly-owned subsidiary, risk management, ex-dividend, in escrow, average price per share, EBITDA


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use