Better Than Bond Funds
September 27th, 2010
People like the idea of bond funds because of the yield they achieve and, consequently the income that such funds pay out on a monthly basis (or quarterly depending on the fund you invest in). But the problem with bond funds is that they generate income strictly from bonds, meaning you are heading into a losing proposition, especially if rates finally start to increase. One alternative to a bond fund is an Income fund which can generate its income from any source, including preferred and common equities, bonds themselves as well as a host of other sources. This makes them better than bonds, hands down.
Entry Filed under: Investing