An income fund is a fund whose goal is to provide an income from investments.
Video Income fund
Features
An income fund is a type of asset allocation fund.
Income funds are often assumed to be bond funds, but they may be stock funds instead, more accurately called equity income funds. Typically these hold stocks with a good history of paying dividends. In fact, a typical income fund holds both stocks and bonds, to gain some of the strengths of both.
The point in any case is that the investor is more interested in income than capital gains, perhaps with the intention the fund will never be sold.
Income funds are often used as the endpoint for target-date funds. As each target-date fund approaches and passes its target date, it becomes more similar to the fund provider's income fund. At some point past the target date, the target-date fund may be merged into the income fund, which will then be owned by all investors whose target dates are some time in the past.
Maps Income fund
See also
- Stock fund
- Bond fund
- Money market fund
- Balanced fund
- Target date fund
- Income trust
- Exchange fund
References
Source of article : Wikipedia
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