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Treasury Inflation Protected Security

Treasury Inflation Protected Security definition - finance
A treasury note or bond that is issued at a fixed rate of interest. The principal is adjusted every six months based on changes in the consumer price index. TIPS are a form of an inflation-indexed securities. The popularity of TIPS has been limited since they were introduced by the U.S. Treasury Department in the late 1990s because inflation has been very modest.

Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.

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Interest has been modest due to .....Appreciation is paid out at maturity, but is subject to the taxation of an Original Issue Discount (OID) during life of bond. And for all BUT tax-deferred accounts...Interest is taxable at the federal level (both realized and unrealized). Exempt from state and local taxes.

Posted by Brian Gidley 92 days ago.

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