: Each resulting strip becomes a zero-coupon bond , meaning it does not pay periodic interest but is instead sold at a deep discount to its face value.
: They can be used to build "bond ladders," where different strips mature at regular intervals to provide steady cash flow. matures strips
: Even though no cash interest is paid until maturity, the annual increase in the strip's value is often taxed as "phantom income" unless held in a tax-deferred account like an IRA. Strategic Use Cases : Each resulting strip becomes a zero-coupon bond