The growth of the earnings on an investments principals Capital Gain Arise when an investment is sold at a higher price than originally paid. In a mutual fund, capital gains are created when the fund buys and sells underlying securities at a premium over purchase price. These gains are then distributed to unitholders at least annually. Unitholders can also earn capital gains by redeeming their fund shares at higher prices than they originally paid. Certificate of Deposit Debt instruments issued by banks and savings and loans.
Maturities range from overnight to many years.
Certificates of Deposit are issued at par and pay fixed interest at intervals or maturity. Can be brokered through Broker Dealer Common Stock Securities that represent an ownership interest in a corporation. Compounding The computation of interest paid using the principal plus the previously earned interest. Cost Averaging Buying securities at scheduled intervals at the same amount. Corporate Bond Debt obligations issued by corporations as an alternative to offering equity ownership by issuing stock.