Series 79: Treasury Inflation-Protected Securities

Treasury Inflation-Protected Securities

Treasury Inflation-Protected Securities, or TIPS, are a relatively new form of government security. Like T-notes and T-bonds, TIPS have a fixed coupon and pay interest twice a year. However, the principal amount of TIPS changes according to movements in the Consumer Price Index. When the inflation rate rises, the principal amount of TIPS rises in tandem, thus offering the inves