STRIP bonds are:

Question

STRIP bonds are:

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STRIP bonds are securities that have the interest and principal payments separated. This means that the coupon payments have been stripped from the bond, creating a "zero-coupon" security that is sold at a discount to its face value. These securities are popular among investors who are looking for long-term, predictable cash flows. They are not offered for sale monthly by the Bank of Canada, they are not overnight loans to banks, and they are not short-term obligations of the Canadian government. While they may have a relatively low coupon rate, this is not the defining characteristic of a STRIP bond.

STRIP Bonds Are