Simple English definitions for legal terms
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A dual fund is a type of mutual fund that invests in two classes of stock - one that pays dividends and another that increases in investment value without dividends. It combines the characteristics of an income fund and a growth fund.
For example, a dual fund may invest in both dividend-paying stocks and growth stocks. The dividend-paying stocks provide a steady income, while the growth stocks offer the potential for capital appreciation. This type of fund is also known as a leverage fund or split fund.
Investors who want both income and growth from their investments may choose a dual fund. However, it's important to note that this type of fund may be riskier than other types of mutual funds because it invests in both income and growth stocks.