Treasury Inflation-Protected Securities (TIPS) investment & finance definition

Negotiable bonds issued and guaranteed by the U.S. Treasury with returns that are indexed to compensate bondholders for inflation. Indexing is accomplished by adjusting the principal amount of TIPS upward to adjust for changes in the consumer price index. These securities were first issued in 1997 and represent a relatively small portion of U.S. government debt. See also Series I savings bond.