Category 2
Dividend & distribution investments
You own a slice of a business or fund, and it pays out part of the profits.
Everything in this category is paid the same way, so what separates one page from the next is the wrapper rather than where the money comes from: how much it takes to start, how quickly you could turn it back into cash, who does the work, how it is taxed, and how it fails. The line on each card says whether the income keeps arriving once it is set up or whether somebody has to keep working for it. If the mechanism itself is new to you, the course spends a whole lesson on it and is a shorter way in than any single page here.
Dividend-Paying Common Stocks
Shares in a company whose board chooses to hand some of the profits back to shareholders in cash, usually every quarter.
Read →Dividend-Growth Stocks
Companies that raise the payment year after year, so the income you collect on your original cost climbs even when the starting yield is modest.
Read →Preferred Stocks
A hybrid security that pays a set dividend ahead of the common shares, sits below the company's debt, and usually has no maturity date.
Read →REITs (Real Estate Investment Trusts)
A company that owns income-producing property, is exempt from corporate tax if it distributes almost all of its taxable income, and trades like a stock.
Read →Business Development Companies (BDCs)
A listed company that lends to mid-sized private businesses and must pay out almost all of the interest it collects, so the yield is high and the credit risk is yours.
Read →Master Limited Partnerships (MLPs)
Publicly traded partnerships, mostly in energy pipelines and storage, that pay large tax-deferred cash distributions and send a K-1 instead of a 1099.
Read →Closed-End Funds (CEFs)
An exchange-listed fund with a fixed share count, so the price can trade above or below the value of what it holds, and it can use leverage to raise the payout.
Read →Income-Focused Mutual Funds
Open-end funds built to distribute cash — equity income, balanced and multi-asset income strategies — bought and sold with the fund itself at the day's net asset value.
Read →Dividend ETFs
Exchange-traded funds that hold a rules-based basket of dividend payers and pass the payments through, usually quarterly, for a small expense ratio.
Read →Covered-Call ETFs
A fund that owns stocks and systematically sells call options against them, then distributes the option premium monthly — trading away upside for cash today.
Read →Infrastructure Funds
Funds holding toll roads, pipelines, airports, water systems, towers and contracted power plants — assets with long contracts and often inflation-linked charges.
Read →Utility Stocks
Shares in regulated electricity, gas and water companies that earn an approved return on the assets they build and distribute a large share of it as dividends.
Read →Royalty Trusts
A passive trust holding a share of the revenue from producing oil, gas or mineral properties, distributing whatever arrives and shrinking as the reserves deplete.
Read →