STRIPS (Separate Trading of Registered Interest and Principal of Securities) Law and Legal Definition

According to 31 CFR 356.2 [Title 31 -- Money and Finance: Treasury; Subtitle B -- Regulations Relating to Money and Finance; Chapter II -- Fiscal Service, Department of the Treasury; Subchapter B -- Bureau of the Public Debt; Part 356 -- Sale and Issue of Marketable Book-Entry Treasury Bills, Notes and Bonds (Department of the Treasury Circular, Public Debt Series No. 1-93); Subpart A -- General Information], STRIPS (Separate Trading of Registered Interest and Principal of Securities) means “a program under which eligible securities are authorized to be separated into principal and interest components, and transferred separately. These components are maintained and transferred in the commercial book-entry system.”