Income Stocks
Income Stocks
Income stocks
are stocks in companies that are usually fairly well established and that make
a relatively regular amount of profit. Income stocks generally have a solid history of making
regular dividend payments. This does not mean that these companies never reinvest their
profits; however, providing dividends is more important, so reinvestment will usually be a
small percentage of the profit if it exists at all. Investors will usually buy this type of stock
because they wish to receive regular dividend payments. As a result of all this regularity,
there's usually very little volatility involved in the value of these stocks. Examples of these
types of stock include Bell Atlantic (communications), Con-Ed (utilities) and General Electric
(utilities). As you can see from these examples, these industries tend to receive regular
payments from their customers as opposed to industries such as retail stores where income
could vary significantly.
