Trust Preferred Securities - TruPS

AAA

DEFINITION of 'Trust Preferred Securities - TruPS'

A security similar to debentures and preferreds that is generally longer term, has early redemption features, makes quarterly fixed interest payments, and matures at face value.

INVESTOPEDIA EXPLAINS 'Trust Preferred Securities - TruPS'

TruPS have been created by companies for their favorable accounting treatments and flexibility. Specifically, these securities are taxed like debt obligations by the IRS while maintaining the appearance of equities in a company's accounting statements as according to GAAP procedures.

RELATED TERMS
  1. Equity Unit Investment Trust

    A registered trust in which investors purchase units from a fixed ...
  2. Convertible Debenture

    A type of loan issued by a company that can be converted into ...
  3. Face Value

    The nominal value or dollar value of a security stated by the ...
  4. Generally Accepted Accounting Principles ...

    The common set of accounting principles, standards and procedures ...
  5. Debenture

    A type of debt instrument that is not secured by physical assets ...
  6. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
Related Articles
  1. Bond Basics Tutorial
    Retirement

    Bond Basics Tutorial

  2. Why should I keep records on my tax-exempt ...
    Taxes

    Why should I keep records on my tax-exempt ...

  3. What determines the price of a bond ...
    Bonds & Fixed Income

    What determines the price of a bond ...

  4. What are some examples of how cash flows ...
    Personal Finance

    What are some examples of how cash flows ...

Hot Definitions
  1. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  4. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  5. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  6. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
Trading Center