Inflation-Protected Security - IPS

Inflation-Protected Security - IPS

A type of fixed-income investment that guarantees a real rate of return. The real rate of return is the nominal return, less the inflation rate, thus protecting investors from inflation.

Notes:

The purchase of IPS products is most often done with government products, such as Treasury inflation-protected securities (TIPS), but private sector companies also offer these products.

See also: Corporate Inflation-Linked Securities, Inflation, Inflation-Linked Savings Bonds (I Bonds), Inflation Risk, Nominal Interest Rate, Real Rate of Return, Treasury Inflation-Protected Securities - TIPS