Income Funds
What Is an Income Fund?
- An income fund is a mutual fund or exchange-traded fund (ETF) that seeks to generate current income through dividends or interest payments.
- Some also provide an opportunity for capital appreciation.
Types of Income
There are a number of different types of income-producing funds, each with their own characteristics and level of risk.
Bond Funds
Bonds are issued by corporations or government entities and generally pay investors a fixed amount of interest each year. A bond fund is typically comprised of debt instruments, such as bonds and mortgage-backed securities.
High-Yield Bond Funds
High-yield bonds are issued by corporations with lower credit quality ratings. They are riskier than bonds issued by higher rated investment-grade companies, so they often offer higher yields.
Municipal Bond Funds
Municipal bonds are issued by state and local governments in the US as well as other public authorities, such as school districts. Generally speaking, interest on municipal bonds is exempt from federal income taxes. In some states, interest on bonds issued by that state, and the municipalities within it, are also exempt from that state’s income taxes.
Global Bond Funds
Global bond funds invest in a wide variety of bonds issued by various public and private entities around the world, including sovereign governments, international agencies, state and local authorities, and private corporations.
Equity Income Funds
Equity income funds purchase equity, or stock ownership, in companies. These funds generally seek capital appreciation as the value of the stocks in the fund increases, and may also seek to generate income from stocks that pay dividends.
Hybrid or Multi-Asset Funds
Hybrid or multi-asset funds may invest in a number of traditional equity and fixed income strategies, index-tracking funds, financial derivatives as well as alternative investments, such as real estate investment trusts (REITs) and commodities.
Our Income Funds
We offer a wide range of mutual funds that can help investors generate income.
Franklin Income Fund
The fund seeks to maximize income, while maintaining prospects for capital appreciation, by investing in a diversified portfolio of stocks and bonds.
Broad Diversification
Our fund has a diversified portfolio across several different asset classes, including dividend-paying stocks, bonds and convertible securities.
Experienced Management Team
Managers Ed Perks, Matt Quinlan, Todd Brighton and Richard Hsu have managed the fund since 2002, 2012, 2017 and 2017, respectively.
Featured products
Franklin Income Fund - Advisor Class
The fund seeks to maximize income, while maintaining prospects for capital appreciation, by investing in a diversified portfolio of stocks and bonds.
- Asset Class
- Multi-Asset
Templeton Global Bond Fund - Advisor Class
Seeks current income with capital appreciation and growth of income by investing primarily in government bonds, including government-related entities and agencies located anywhere in the world. The fund regularly uses various currency-related and derivative instruments.
- Asset Class
- Fixed Income
Franklin Federal Tax-Free Income Fund - Advisor Class
The fund seeks to provide investors with as high a level of income exempt from federal income taxes as is consistent with prudent investment management and the preservation of shareholders’ capital.
- Asset Class
- Fixed Income
Franklin Core Plus Bond Fund - Advisor Class
Seeks to provide a high level of current income. Its secondary goal is capital appreciation over the long term. The fund is a multi-sector income fund that invests primarily in U.S. and foreign debt securities.
- Asset Class
- Fixed Income
What Makes Franklin Templeton Different?
Commitment to Active Management
Our belief in the value of active management has consistently guided our investment decisions and differentiates us from passive investors. Active asset management provides potential for outperformance and risk diversification relative to the broad market.
Decades of Specialized Expertise
Our seasoned investment teams, each providing their own unique style and perspective, build portfolios based on proprietary methodologies.
Global Integrated Platform
The around-the-clock support of our global investment platform allows our investment teams to focus on research and portfolio management.
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Important Information
This website does not provide investment advice or investment recommendations. It is intended for educational and informational purposes only.
All investments involve risks, including possible loss of principal.
Generally, those offering potential for higher returns are accompanied by a higher degree of risk. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices are affected by interest rate changes. Bond prices, and thus a bond fund's share price, generally move in the opposite direction of interest rates. As the price of bonds in a fund adjusts to a rise in interest rates, the fund's share price may decline. High-yield, lower-rated ("junk") bonds generally have greater price swings and higher default risks. Foreign investing, especially in developing markets, has additional risks such as currency and market volatility and political or social instability. For tax-free income funds, the alternative minimum tax may apply. These and other risks pertaining to specific funds, such as those involving investments in specialized industry sectors or use of complex securities, are discussed in each fund's prospectus. By clicking on the fund name, you will be taken to a more detailed fund information page which includes main investments and risks.
For investors subject to the alternative minimum tax, a small portion of dividends of a tax-free income portfolio may be taxable.
For more information on any of our funds, contact your financial professional or download a free prospectus.
Investors should carefully consider a fund’s investment goals, risks, charges and expenses before investing. Download a summary prospectus and/or prospectus, which contains this and other information. Please carefully read a prospectus before you invest or send money.