Growth and Income Funds are a class of mutual fund or exchange-traded fund (ETF) that has a dual strategy of both capital appreciation (growth) and current income generated through dividends or interest payments. Growth and income funds are usually classified in one of two categories: growth funds and income funds. A growth fund strives to outperform its benchmark index by investing in companies with strong revenue and earnings growth. Income funds continue to invest in stocks that pay periodic dividends, even if their price drops significantly below the value of their net asset value (NAV).A growth and income fund is a hybrid fund class of mutual funds or ETFs that have both long-term capital appreciation (growth) as well as current income generated through dividends. In the context of short-term financial planning, the lifetime income produced by a growth and income fund helps investors plan for their retirement while having access to security gains during their working years.Growth and income funds are a popular way to invest in the stock market. These investments tend to invest in stocks that are expected to provide both a high growth rate, but also high dividends or interest payments. Most people like the strategy because it provides them with current income, allowing them to balance work and their investments in order to achieve financial independence.
