Frequently Asked Question

January 08 2010  |  Filed Under » ,

An IA’s client has a primary goal of tax reduction and a secondary goal of current income. Which investment would be most appropriate?

a. Treasury STRIPS b. Growth stocks

c. Fixed annuities

d. Municipal bonds


Answer: D

Fixed annuities, growth stocks and STRIPS offer no current income. Also, fixed annuities offer tax-deferral of income, while municipal bonds offer tax-free income.

Sign Up For Investing Basics!

Try Our Stock Simulator!

Test your trading skills!

by

Investopedia.com

Investopedia.com
No writer biography is available.
comments powered by Disqus
Last Questions Asked:
  1.

    Does the federal government fund any NGOs? Which ones?

  2. If I want to have some cash in a liquid account for unexpected emergencies, what is best? A savings account or another type?

  3. What is a triple tax-free municipal bond?

Recommended
Loading, please wait...
See More »
Trading Center