Certificates of Deposit (CDs) and stocks offer both capital gains and interest income, while bonds mainly provide interest income with limited capital gains potential.
Certificates of Deposit (CDs) are a type of investment that offer both capital gains and interest income. When you invest in a CD, you receive interest income over the term of the deposit, and upon maturity, you can also earn capital gains if you sell the CD at a higher value than you purchased it for.
Another investment option that provides both capital gains and interest income are stocks. Owning stocks entitles you to dividends as well as potential capital gains if the stock price increases over time. Stocks offer a combination of income through dividends and capital appreciation.
On the other hand, while bonds provide interest income, they usually do not offer capital gains since bonds typically have a fixed maturity value. Bonds offer a fixed interest income over the bond's term, but the capital gains potential is limited compared to stocks or CDs.
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