Corporate Inflation-Linked Securities

DEFINITION of 'Corporate Inflation-Linked Securities'

Corporate debt financing securities that offer their holders protection against fluctuations in the rate of inflation as measured by the consumer price index (CPI). The yields of these securities adjust monthly with respect to the current rate of inflation.

BREAKING DOWN 'Corporate Inflation-Linked Securities'

Although they are not as common as conventional debt instruments, inflation-protected corporate debt can provide an investor with a balanced risk exposure: these securities pose all of the normal risks associated with regular corporate debt securities - such as default risk - but they remove the possibility of inflationary changes eroding their real returns.

RELATED TERMS
  1. Municipal Inflation-Linked Securities

    Investment vehicles issued by various levels of governments containing ...
  2. Inflation-Linked Certificates of ...

    Federally insured debt securities that are similar to regular ...
  3. Inflation Protected

    The types of investments that provide protection against inflation ...
  4. Inflation-Linked Savings Bonds ...

    U.S. government-issued debt securities similar to regular savings ...
  5. Security

    A financial instrument that represents an ownership position ...
  6. Debt Security

    Any debt instrument that can be bought or sold between two parties ...
Related Articles
  1. Investing Basics

    What's a Debt Security?

    A debt security is a financial instrument issued by a company (usually a publicly traded corporation) and sold to an investor.
  2. Bonds & Fixed Income

    Curbing The Effects Of Inflation

    Your investments suffer when general price levels rise. Learn how you can control the damage with IPSs.
  3. Options & Futures

    The Consumer Price Index: A Friend To Investors

    As a measure of inflation, this index can help you make key financial decisions.
  4. Professionals

    Debt Securities

    Series 62
  5. Investing Basics

    Treasury Inflation-Protected Securities (TIPS)

    Treasury inflation-protected securities are treasury securities that make adjustments for inflation as reflected in the Consumer Price Index.
  6. Investing

    Corporate Bonds and the Impact of Inflation Risk

    The impact of inflation risk affecting corporate bond returns can be significant. It may even result in a real loss of purchasing power.
  7. Investing

    Why Some Investors Are Tilting Toward TIPS

    Last month’s five-year TIPS auction drew nearly $48 billion in interest, a sign of recent renewed demand for this inflation indexed asset among investors.
  8. Professionals

    Debt (Long-Term, Short-Term, Secured and Unsecured)

    Debt (Long-Term, Short-Term, Secured and Unsecured)
  9. Forex

    Inflation

    An in-depth look at inflation
  10. Economics

    What The National Debt Means To You

    The national debt is the net accumulation of the government’s annual budget deficits.
RELATED FAQS
  1. How do I evaluate a debt security?

    Look at a brief overview of the important factors to consider before purchasing a debt security, such as a corporate or government ... Read Answer >>
  2. When is the best time to invest in inflation-protected securities?

    Learn how to determine when to consider buying an inflation-protected security to enhance the returns of your investment ... Read Answer >>
  3. Should I include inflation-protected securities in my 401(k)?

    Learn how to protect your 401(k) from the adverse effects of inflation by adding inflation-protected securities to your portfolio. Read Answer >>
  4. What is inflation and how should it affect my investing?

    Inflation, an economic concept, is an economy-wide sustained trend of increasing prices from one year to the next. The rate ... Read Answer >>
  5. When is the best time to buy a fixed income security?

    Determine the optimal time to buy fixed income securities; the key is inflation and interest rates falling, which makes the ... Read Answer >>
  6. Is Social Security inflation-protected?

    Understand how U.S. Social Security benefits are indexed to changes in prices to adjust for changes in the cost of living ... Read Answer >>
Hot Definitions
  1. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  2. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  3. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  4. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  5. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
  6. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
Trading Center