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Watch Out for the Dividend Yield Trap



Comments (3)

  1. This is a huge problem right now. Investors are chasing yield because they are starved for income. Sometimes preservation of capital is more important than income or capital gains. Quality is essential given current risks.

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  2. julia cichon says:

    You didn’t include Annaly Capital and
    Cimera, both are REITS with high dividends. Both incorporated just at the point of the RE Bubble.

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  3. Gentolet says:

    MG,The purpose is total rtruen, but then the dividend income is much easier to “forecast” than annual market fluctuations.The point is to not have “favorite” stocks which you fall in love with, and where you ignore the fundamentals. Yes, I do prove my point by cherry picking, but then how else are you going to show your point?Magnus,I prefer investing in companies that pay a stable dividend, rather than ones whose dividend payment fluctuates.Anon,Yes, over the past few months I have reinvested my dividends selectively, and not automatically.

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