Treasury Inflation Protected Securities - TIPS
Definition of 'Treasury Inflation Protected Securities - TIPS'A treasury security that is indexed to inflation in order to protect investors from the negative effects of inflation. TIPS are considered an extremely low-risk investment since they are backed by the |
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Investopedia explains 'Treasury Inflation Protected Securities - TIPS'Because a TIPS bond's semiannual inflation adjustments are considered taxable income by the IRS even though investors don't see that money until they sell the bond or it reaches maturity, some investors prefer to get TIPS through a TIPS mutual fund or only hold them in tax-deferred retirement accounts to avoid tax complications.Purchasing TIPS directly, however, allows investors to avoid the management fees associated with mutual funds. TIPS are also valuable because they are exempt from state and local income taxes. |
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Treasury Inflation Protected Securities
If you want to protect your portfolio from inflation, all you need are a few TIPS.
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