Dian's Column
Dian's Archive

Lavine/Liberman Archive




Lipper
Muriel Siebert & Co.


Growth And Income Funds: A Good Combination

- Alan Lavine and Gail Liberman



If you need income and also would like your investment to grow over the long term, consider growth and income funds. These funds invest in large companies that pay dividends.

Dividends are profits corporations pass on to shareholders. Large companies typically pay out about half their profits in the form of dividends.

The following growth and income funds, at this writing, sported dividend yields of at least 2 percent, and have outranked most of their peers based on total return. Total return is the percentage of gain or loss in the value of a fundŐs share, including the reinvestment of dividends and capital gains.

  • Fidelity Asset Manager Growth. The fund yields 2.1 percent. Over the past year ending in July, the total return was 9.5 percent.

  • Nicholas Equity Income Fund. The fund yields 2.4 percent. Over the past year ending in July, the total return was 17.1 percent.

  • Vanguard Dividend Growth Fund. The fund yields 2 percent. Over the past year ending in July, the total return was 12.4 percent.

  • Vanguard Value Index Fund. The fund yields 2.2 percent. Over the past year ending in July, the total return was 18.3 percent.

  • Vanguard Windsor II. The fund yields 2 percent. Over the past year ending in July, the total return was 19 percent.

Be advised. This year, the overall stock market and these funds have not registered stellar returns. The S&P 500 is up about 2 percent. The above funds typically track the performance of the S&P 500. So donŐt expect these funds to earn double-digit returns every year.

#

Alan Lavine and Gail Liberman are husband and wife columnist and authors of The Complete Idiot's Guide To Making Money With Mutual Funds, (Alpha Books). Al and Gail's new book is Rags to Retirement, (Alpha Books).


To read more columns, please visit the column archive.




[ top ]