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A Few Related Terms

Mutual Fund
Corporate Bond
Municipal Bond
Bond Ratings

Unit Investment Trust (UIT)
Term category: General Investing
In 10 words or less: A trust that typically invests in bonds and pays the income to the owners.

Definition: A unit investment trust (UIT) is a trust set up to invest in income securities, such as bonds.  When the securities generate income, it is paid out to shareholders in the trust.  When the bonds have all matured, the trust is dissolved.

StockJargon Advice: UIT's are commonly sold to investors through brokers.  They're a little bit harder to gain information on but there is a secondary market for these securities as well.

Because municipal bonds typically have large initial purchase requirements, many UIT's are formed to invest in them.  This allows multiple investors to pool their money.

Related Articles

A Look Into Mutual Funds
So you want to start investing but are afraid to risk your money in one stock. Well, mutual funds might be the safer alternative for you..

Closed-End Funds
Funds traded like stocks? You bet!

Municipal Bonds
These types of bonds may allow you to avoid a large tax bill...


Related Books

The Fundamentals of Municipal Bonds by The Bond Market Association
The Bond Book by Annette Thau
How the Bond Market Works by Robert Zipf
Beating the Dow with Bonds By Michael B. O'Higgins

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