AN INTRODUCTION TO INCOME FUNDS
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Income funds are not named after a particular type of security.
Instead, they are named after their investment objective, which is to
provide current income on a steady basis. While their individual holdings
may also grow (or appreciate) in value, the funds are structured to provide
of principal is another major concern to those who manage many income funds
and for those who invest in them?in other words, they seek to avoid losing the
funds they invest.
Investors whose primary objective is income are attracted to
these funds. Many conservative investors and retirees like income funds because
of the steady dividends. Income funds are likely to pay higher returns than
certificates of deposit and money market investments.
Now we will look at how income funds achieve their