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inflation-indexed security

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Financial Dictionary

Inflation-Indexed Security

A security that guarantees a return higher than the rate of inflation if it is held to maturity.

Investopedia Commentary

In other words, an inflation-indexed security guarantees a real return. These usually come in the form of a bond or note.

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See also: CPI, Deflation, Disinflation, Fed, Hyperinflation, Inflation, Inflationary Psychology, PPI, Real Rate of Return, Reflation, RPI, Stagflation, Stagnation, Treasury Inflation Protected Securities (TIPS)

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Financial Dictionary

inflation-indexed security

A security with a rate of return linked to some specified measure of inflation. For example, Series I U.S. savings bonds pay holders a specified fixed rate adjusted for changes in the consumer price index.

Wall Street Words: An A to Z Guide to Investment Terms by David L. Scott.
Copyright © 2003. Published by Houghton Mifflin.
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