Equity Income

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DEFINITION of 'Equity Income'

1. Dividend income that is earned through an investment in stocks (equity).

2. A type of mutual fund that invests in high-quality companies with a reliable history of dividend payments and growth in the dividend rate.

INVESTOPEDIA EXPLAINS 'Equity Income'

1. Dividend paying stocks are usually those of large, well-established companies that are favored by moderately conservative investors and/or those seeking current income.

2. In the mutual fund context, the investment objective will be a combination of generating both moderate current dividend income and moderate capital appreciation.

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  5. Capital Gain

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  6. Equity

    1. A stock or any other security representing an ownership interest. ...
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  2. When can I use the Dividend Discount Method (DDM) to value a stock?

    Investors can use the dividend discount model (DDM) for stocks that have just been issued or that have traded on the secondary ... Read Full Answer >>
  3. What is the average annual dividend yield of companies in the Internet sector?

    The average annual dividend yield of companies in the Internet sector is 0.02%. The dividend payout ratio for the sector ... Read Full Answer >>
  4. How is perpetuity used in the Dividend Discount Model?

    The basic dividend discount model (DDM) creates an estimate of the constant growth rate, in perpetuity, expected for dividends ... Read Full Answer >>
  5. What are the drawbacks of using the Dividend Discount Model (DDM) to value a stock?

    Drawbacks of using the dividend discount model (DDM) include the difficulty of accurate projections, the fact that it does ... Read Full Answer >>
  6. Should I purchase a master limited partnership (MLP) in my retirement account?

    Most investors should not purchase units in a master limited partnership, or MLP, in their retirement accounts. MLPs offer ... Read Full Answer >>
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