SPDR Barclays TIPSIPE

Morningstar Rating

ETF Research and Analysis

by Abby Woodham
Suitability
SPDR Barclays TIPS IPE, which tracks a broad, cap-weighted Treasury Inflation-Protected Securities bond index, is a slightly longer duration alternative to sector giant iShares Barclays TIPS Bond TIP. TIPS combine the security   Read more 

Bull Case

TIPS let investors hedge against unexpected inflation: the possibility that the future rate of inflation is higher than the market expects.
The market's expected rate of future inflation is well below the historical average rate of inflation. TIPS might still be inexpensive.
Individual TIPS are taxed each year on their inflation adjustment, even though investors don't receive most of the adjustment until maturity. IPE pays out the adjustment. Read more 

Bear Case

TIPS funds like IPE are not correlated with inflation, so an investment in TIP will not guarantee preserved purchasing power over any time period.
IPE's long duration means it is exposed to interest-rate risk.
If the market overestimates the future rate of inflation, Treasuries will outperform TIPS. Read more 

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