Please enable JavaScript.
Coggle requires JavaScript to display documents.
Portfolio Income, Source - Coggle Diagram
Portfolio Income
3 Ways to Increase Portfolio Income
Purchase High-Paying Dividend Stocks
Dividends can be paid directly to the shareholder or used to purchase additional shares in the company, referred to as a dividend reinvestment plan (DRIP).
What are Dividend Stock?
Dividend stocks are companies that pay out a portion of their profits to shareholders. These payouts can come monthly, quarterly, or annually. There are different types of dividends and there isn't a set amount a company pays out.
https://www.investopedia.com/terms/d/dividend.asp
:warning:
Purchase Dividend Exchange-Traded Funds
Buying ETFs that specifically track high-paying dividend stocks is a cost-effective way to increase portfolio income. For example, the Vanguard High Dividend Yield ETF tracks the FTSE High Dividend Yield Index. The index includes 396 stocks that have high dividend yields.
The selection criteria for other dividend ETF choices may focus on how many consecutive years the company has paid a dividend or on companies that have a history of increasing their dividend payments each year.
What Is an Exchange-Traded Fund (ETF)?
An exchange-traded fund (ETF) is a type of pooled investment security that operates much like a mutual fund.
What is a Mutual Fund ?
A mutual fund is a company that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt.
Typically, ETFs will track a particular index, sector, commodity, or other assets, but unlike mutual funds, ETFs can be purchased or sold on a stock exchange the same way that a regular stock can.
Write Options
An investor can increase portfolio income by writing call options against their stock holdings.
For example, suppose an investor owns 100 shares of Microsoft and the stock is trading at $175 per share. The investor could agree to sell the shares if the stock rises 10% to $192.50. To do this, the investor sells 1 call option with a strike price of $192.50 at $2.
Portfolio income is money received from investments, dividends, interest, capital gains and Royalties.
It is one of three main categories of income.
Most portfolio income gets favorable tax treatment. Dividends and capital gains are taxed at a lower rate than earned income. In addition, portfolio income is not subject to Social Security or Medicare taxes.
The categories of income are important for tax purposes. Losses in passive income generally cannot be offset against active or portfolio income.
Source
https://www.investopedia.com/terms/p/portfolioincome.asp
Dividend Stocks: What They Are, How They Work, How to Invest
https://www.investor.gov/introduction-investing/investing-basics/investment-products/mutual-funds-and-exchange-traded-1
https://www.investopedia.com/terms/e/etf.asp