Equity Investing Information

Stocks - Mutual Funds - Private Equity - Real Estate

Income Trust Investing

An income trust is a pooled investment security, which places investors' money primarily in income-producing assets. Similar to dividend funds but structured as stocks, income trusts generally pay investors a set monthly or quarterly dividend.

Unlike fixed-income investments, however, there is nothing to stop income trust administrators from raising or lowering the payment of distributions at will, placing these investments in a much higher risk category.

The actual risks associated with income trusts vary widely, depending on what exactly they invest in. Unlike balanced mutual funds, trusts usually invest in only one industry or even one enterprise, making them highly vulnerable to changes their respective economic sectors.

Before buying in to a trust, it is a good idea to do plenty of research, speaking with a licensed investment advisor whenever possible. Try to avoid trusts that are grossly overvalued, or pay out more than they earn on a regular basis.