They are popular among those who tolerate volatility well and who want to leave their money in their funds for a long time. Like growth funds, aggressive-growth funds often forego paying dividends so they can invest their earnings back into the companies they hold. They focus on paying dividends as their top priority while de-emphasizing the growth in value of their portfolios. Income funds place a large percentage of their funds into preferred stocks and bonds because these investments yield relatively stable current income. They may also invest in cash and money market securities.
Income funds are popular with investors who want stable income from their mutual funds.
Read below to learn about Balanced Funds. The objective of balanced funds is to provide both of these ends together. Managers of balanced funds can, however, shift this ratio one way or the other to take advantages of high interest rates or stock market growth. Balanced funds generally have low volatility and are popular with investors seeking current income with growth potential. They may choose industries such as health care, the automobile industry, biotechnology or pharmaceuticals.