How to buy tips bonds?

17th Nov 2009 by Joseph Pousada

Treasury Inflation-Protected Securities (TIPS) are government securities issued by the treasury department of the United States of America. This is a debt instrument backed by the full faith and credit of the US government. TIPS are tied to the consumer price index with the interest amount paid periodically and the principal amount of the security adjusted with an increasing adjustment when there is a rise in inflation in the consumer price index or a decreasing adjustment when there is a fall in inflation in the consumer price index. An investor looking for income that has some protection against inflation, relative safety in their principal would discuss such an investment with their financial advisor.

These debt instruments can be purchased directly from the Treasury or through your personal broker/dealer. Information on purchasing directly can be obtained through the website http://www.treasurydirect.gov.


Reference:
http://www.treasurydirect.gov/indiv/research/indepth/tips/res_tips.htm


This answer is the subjective opinion of the writer and not of FinancialAdvisory.com