Question

Separate Trading of Registered Interest and Principal Securities (STRIPS):

a. are securities issued by the U.S.
b. Treasury have little relationship to yields on coupon bearing U.S.
c. Treasury securities are registered with the SEC at time of issuance
d. All of the above
d. None of the above

Answer 1

The correct answer is the option A: are securities issued by the U.S.

Step-by-step explanation:

To begin with, the ''Separate Trading of Registered Interest and Principal Securities'', or also known as STRIPS, are debt securities issued by the Government of the United States and that have the principal characteristic that they are separated from the corpus of the bond so that the two parts can be sold separately and that is, the interest-paying coupon bond and the zero coupon bond. And then the investors can choose freely between buying the securities based on either the principal or the interest of the bond.