TIPS securities provide an inflationary hedge

Our Treasury Inflation-Protected “Real Return” (TIPS) strategy offers investors an opportunity to achieve steady-state “real” return, irrespective of the inflationary environment.

In general, TIPS securities provide an inflationary hedge by linking the principal to inflation; adjusting the underlying amount in response to changes in the inflation rate, as well as a host of other economic and market influences.

Our TIPS product is index-based, providing an index-matched exposure to this asset class. Consequently, our goal is for our returns to be in line with the TIPS Benchmark index returns, and with minimal tracking error.

Our approach to TIPS investing provides clients with numerous advantages, including:

  • Minimized tracking error

  • Mitigated active management bias

  • A complementary position, vis-à-vis our traditional Core fixed income approach

  • Low management fees

In addition to our TIPS product, we also offer the following strategies:

Index Definition

  • Bloomberg Barclays U.S. Treasury Inflation-Protected Securities (TIPS) Index: Represents securities that protect against adverse inflation and provide a minimum level of real return. To be included in this index, bonds must have cash flows linked to an inflation index, be sovereign issues denominated in U.S. currency, and have more than one year to maturity, and, as a portion of the index, total a minimum amount outstanding of 100 million U.S. dollars. An individual cannot invest directly in an index.