Funds flooding into Hong Kong stocks high dividend track, experts warn of two major investment pitfalls.

The remarkable outbreak of the Hong Kong stock market in the first quarter of this year saw the Hang Seng Index rise by as much as 15.25%. However, with global capital markets entering a period of turbulence since the second quarter, uncertainty has significantly increased. In this environment, many institutions and brokerages are advising investors to seek out safe havens during market volatility, focusing on high dividend companies with stable profit expectations. They recommend allocating these assets as core holdings to obtain relatively steady dividend income. However, several experts caution against falling into the "high dividend trap". Dong Kang, Director General and Chief Asset Research Officer of the Development Research Center of GF Securities, believes that compared to the A-share and U.S. stock markets, the high dividend strategy in the Hong Kong stock market stands out more and is a long-term winning strategy. However, traditional high dividend investment methods may lead to two traps - the "dividend trap" and the "valuation trap", highlighting the need to carefully select genuine high dividend stocks.