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Income Stock
Common stock that pays dividends at a higher-than-average rate, resulting in a higher yield for stockholders. Income stock frequently in preferred by investors who seek current income in addition to growth.


Any of a number of composites that reflect movement in financial markets, indicating market prices and shares outstanding of companies included in the index. Examples are: the Down Jones Industrial Index, the Russell 2000 Index, Standard & Poor's 500 Composite Stock Index, and the EAFE Index.


Index Fund
A fund managed with the objective of duplicating the performance of securities in a broad-based index by investing in all or most of the securities included in that index.


Individual Retirement Account (IRA)
A method of planning for retirement that enables individuals to save up to $2,000 annually. These funds, called contributions, are in addition to any retirement plan already in place by the individual's employer. In addition, if an individual's employer has adopted a Savings Incentive Match Plan for Employees, the employee will be able to make a pre-tax elective contribution to an IRA of up to $6,000 annually. IRA funds are tax-deferred, that is, not subject to tax until withdrawals are made, when the individual may be in a lower tax bracket. (See Tax-Deferred Investment).


Individual Retirement Account "Rollover"
A special IRA that is established specifically for taxable funds distributing from a tax-qualified retirement plan. As in the case of a regular IRA, funds are not subject to tax until they are withdrawn from the account.


Information Ratio
A measure of risk-adjusted relative return.



  • Earnings paid by any fixed-income security (a bond, a certificate of deposit, or an annuity, for example.)
  • Money paid for the use of money -- that is, paid for a loan.


Interest Coverage Ratio
Is operating earnings divided by interest expense; it is one way to examine a company’s ability to service its debt.


Investment Management Account
An account whereby a financial institution is given discretionary power with regard to investment decisions on behalf of the investor. Fees for this service vary, but usually are based on a percentage of the overall value of the funds under management.


Irrevocable Trust
A type of trust that cannot be revoked or changed in any way.


Invasion of a Trust
Refers to a distribution of assets made from the principal of a trust. 

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