Current Dividend Yield is good but avoid falling into potential Dividend Traps (4)

Read? Current Dividend Yield is good but avoid falling into potential Dividend Traps (3)

How to avoid falling into potential dividend trap?

One of good way is to change your view of looking at dividend yield.

Many income and yield chasing investors tend to view dividend yield in this way. So much focus on high dividend yield e.g. 8-10% and less concern on high dividend payout e.g  90%.  Potential capital appreciation is just nice to have.

How about changing your view to this way?

Primarily focus on potential capital appreciation and dividend yield is just the safety net that provides enough cushion if the stock price doesn't appreciate but fall.