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How are investors compensated for investing in TIPS?

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How are investors compensated for investing in TIPS?

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TIPS investors are compensated in two ways. First, the outstanding principal balance (called the accrued principle) is adjusted daily for inflation (or deflation), which accrues until the TIPS reach maturity. Secondly, a real rate of interest is paid in cash semi-annually on the accrued principal value.

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