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Article: Buying a basket of income trusts: mutual funds that hold a portfolio of income trusts offer some advantages. (Mutual Funds).
- Article from:
- Money Digest
- Article date:
- August 1, 2001
CopyrightCOPYRIGHT 2001 Money Digest. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Income trusts can be attractive to fixed income investors. These securities generally provide high returns. They are also tax-advantaged. Income trusts are mainly bought by income-oriented investors who seek a return that is higher than what can be obtained through the conventional bond market.
Although many investors prefer to hold these investments directly, there are many funds that hold a portfolio of such income trust investments.
Investing in such a mutual fund is somewhat more expensive than owning the trusts directly, since, even if you buy a no-load fund you still have to pay an annual management fee. However, there are some advantages.