Which type of investment typically provides dividends to shareholders?

Stocks are a type of investment that often provides dividends to shareholders. Dividends are payments made by a company to its shareholders, typically derived from a portion of the company's profits. When you own shares of stock in a company, you become a part-owner, and if the company performs well financially, it may distribute part of those earnings as dividends.

Dividends can be an attractive feature of stocks because they provide a regular income stream in addition to any profits made from selling the stock at a higher price. This characteristic distinguishes stocks from other types of investments. For instance, real estate can generate income through rent but does not directly provide dividends in the same way stocks do. Commodities, which include natural resources and agricultural products, are not directly linked to dividends since they do not represent ownership in a company. Certificates of Deposit (CDs) are time deposits offered by banks that pay interest but do not offer dividends. Hence, stocks are the investment type most associated with providing dividends to shareholders.