Which type of investment typically provides a fixed income?

Annuities are designed to provide a fixed income, making them a popular choice for individuals seeking stable, predictable returns, particularly in retirement planning. An annuity is a contract with an insurance company where the investor makes a lump sum payment or a series of payments in exchange for regular disbursements over time. This structure ensures a steady income stream, often for the duration of the investor's life or for a specified period, reducing the risk associated with market volatility.

In contrast, stocks represent ownership in a company and can offer dividends, but the income from stocks is not fixed and can vary based on company performance and market conditions. Mutual funds are a pooled investment vehicle that can include a variety of asset types, including stocks and bonds, and while some may provide dividends or interest, they do not guarantee a fixed income. Cryptocurrencies are known for their high volatility and do not produce interest or fixed returns; their value is subject to significant market fluctuations. Therefore, the unique structure of annuities is what distinctly provides a fixed income among the mentioned investment types.