Monthly Income Preferred Securities - MIPS

AAA

DEFINITION of 'Monthly Income Preferred Securities - MIPS'

Shares that are an interest in a limited partnership existing solely for the purpose of issuing preferred securities and lending the proceeds of the sales to its parent company. MIPS usually have a $25 par value, NYSE listing and cumulative monthly distributions.

INVESTOPEDIA EXPLAINS 'Monthly Income Preferred Securities - MIPS'

MIPS are hybrid securities, combining features of preferred stock and corporate bonds. Hybrids can pay a higher rate of return than preferred stock because dividends are paid with pretax dollars, generating a sizable tax break for corporations.

RELATED TERMS
  1. Hybrid Security

    A security that combines two or more different financial instruments. ...
  2. Quarterly Income Preferred Securities ...

    Shares that are an interest in a limited partnership that exists ...
  3. Preferred Stock

    A class of ownership in a corporation that has a higher claim ...
  4. Return On Equity - ROE

    The amount of net income returned as a percentage of shareholders ...
  5. Equity Financing

    The act of raising money for company activities by selling common ...
  6. Silent Partner

    An individual whose involvement in a partnership is limited to ...
Related Articles
  1. Investing

    What is the difference between preferred stock and common stock?

    Preferred and common stocks are different in two key aspects. First, preferred stockholders have a greater claim to a company's assets and earnings. This is true during the good times when the ...
  2. Investing Basics

    How Dividends Work For Investors

    Find out how a company can put its profits directly into your hands.
  3. Bonds & Fixed Income

    Advanced Bond Concepts

    Learn the complex concepts and calculations for trading bonds including bond pricing, yield, term structure of interest rates and duration.
  4. Mergers are not the same as acquisitions.
    Investing

    What's a Merger?

    Mergers are not the same as acquisitions. In an acquisition, one company buys and subsumes another company, leaving only the buyer in place. In most mergers, both companies merge to form an entirely ...
  5. Typically, SPEs are subsidiaries of a larger corporation.
    Investing

    How Special Purpose Entities Help Fight Risk

    A special purpose entity, sometimes called a special purpose vehicle, is a legal entity created for one very limited, particular task. Typically, SPEs are subsidiaries of a larger corporation.
  6. Taxes

    How are preferred stock dividends taxed?

    Discover the intriguing debt and equity characteristics of preferred stock, and learn about how preferred stock dividends are taxed.
  7. Bonds & Fixed Income

    Can I invest my IRA in an entity, business or LLC?

    Explore different types of businesses, entities, corporations and limited liability companies, and the types IRA-eligible securities they offer.
  8. In corporate terms, an acquisition is the purchase of a company or the division of a company.
    Investing

    What's an Acquisition?

    In corporate terms, an acquisition is the purchase of a company or the division of a company. Some acquisitions are paid in cash, while others are paid with a combination of cash and the acquiring ...
  9. Curious about preferred shares? Here's what you should know about these bond-like instruments.
    Trading Strategies

    What You Need To Know About Preferred Stock

    Curious about preferred shares? Here's what you should know about these bond-like instruments.
  10. Entrepreneurship

    What's the difference between limited liability partnership and general partnership?

    Learn the differences between general partnerships and limited liability partnerships; each type has unique traits, benefits and risks.

You May Also Like

Hot Definitions
  1. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  2. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  3. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  4. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  5. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
  6. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), expressed as a single percentage number that represents ...
Trading Center