what is an index linked bond 
an index linked bond is a bond in which payment of interest income on the principal is related to a specific price index usually the consumer price index cpi this feature provides protection to investors by shielding them from changes in the underlying index the bond s cash flows are adjusted to ensure that the holder of the bond receives a known real rate of return an index linked bond is also known as a real return bond in canada treasury inflation protected securities tips in the u s and a linker in the u k 