In 1985, the Treasury Introduced a Zero Coupon Bond Called

In 1985, the Treasury introduced a zero coupon bond called STRIPS; they are direct obligations of the federal government. Your client is interested in investing a sum of funds that can grow tax-free and is concerned about bond volatility, what should you inform your client about STRIPS?

A) STRIPS are can be volatile, but grow tax-free
B) STRIPS are non-volatile, but grow tax-free
C) STRIPS are can be volatile, but do not grow tax-free
D) STRIPS are non-volatile, but do not grow tax-free

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