OVERVIEW OF TREASURY INFLATION-INDEXED SECURITIES
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Investor Perspective
on TIPS
Unique asset class
(dollar-denominated,
inflation-protected,
full faith and credit
of the United States).
- Lower historical
correlation with
other asset classes
leading to portfolio
diversification.
- Maintenance of
purchasing power
of savings.
- Relative low volatility
and potentially beneficial
inflation adjusted
returns.
- Deflation floor,
i.e. investors won't
receive back less
than nominal principal
value at maturity.
The TIPS Market
- World’s largest
inflation indexed
securities market.
- Over $550 billion
of TIPS outstanding.
- Average daily turnover
over $5 billion.
TIPS as Part of Treasury's
Funding Strategy
- Nearly 8% of Treasury’s
marketable debt portfolio.
10-year TIPS notes
issued quarterly;
5- and 30-year TIPS
issued semi-annually.
- Market participants
and individual investors
can purchase TIPS
in denominations
as low as $100.
- In addition, investors
can purchase Series
I inflation-indexed
savings bonds.
Contents
TIPS Overview 
A complete description of the terms and conditions of TIPS can be found in the Treasury Uniform Offering Circular and the auction announcement for the applicable TIPS on the Bureau of Public Debt's website.
Additionally, the Bureau of Public Debt’s website www.treasurydirect.gov contains information on how to buy TIPS through TreasuryDirect, Daily Index Ratios for adjusting the Principal Value of TIPS, a general summary of TIPS mechanics, and information on tax treatment.
Recent Speeches
Last Updated:
November 4, 2009
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