Certificate Of Government Receipts - COUGRs

Before cougars (as in, "your mom's a cougar"), there were COUGRs, or Certificates of Government Receipts. A Certificate of Government Receipts is a type of US Treasury bond, minus the coupon payments. Investors make money off of COUGRs only at maturity, gaining the face value.

If you didn’t know: most US Treasury bonds give regular “coupon” payouts until maturity, but not COUGRs. COUGRs take a walk on the wild side, and we’ll tell you why: COUGRs are actually normal bonds, but with an intermediary financial institution keeping the coupon payouts for themselves. Investors still buy them because they’re sold at a discount of the face value. They call these “stripped bonds.”

There are other types of stripped bonds besides COUGRs, all in the cat family. Like TIGRs (Treasury Income Growth Receipts), LIONs (Lehman Investment Opportunity Notes), and CATs (Certificates of Accrual on Treasury Securities). Meow.