What Is The Dogs Of The Dow Investment Strategy And How To Follow It?
What would you say about an average annual return of 17.7% for the last 45 years? I don’t know about you, but I would say GREAT !!! This would have been the return on your money if you invested using the Dogs Of The Dow trading strategy. It’s an absolutely great return, especially because the overall average annual yield of the Dow Jones Index was 11.8% for the very same period. Not only would you have beaten the market, but also you would have made a fortune. In the pictures below, you can see the growth of an investment of only $1000 dollars for 45 years at the rate of 17.7 % Yes, a thousand would have reached 1 530 878 US dollars! Try to calculate it yourself with our compounding interest calculator here and also try what would have happened, if you added to your investment 500 dollars every year J. Believe it or not, this would have grown to nearly 6 000 000 dollars. If you think this is not amazing, you should reconsider it maybe…!
The Dogs Of The Dow strategy is an easy way to achieve these results yourself. It’s extremely simple and extremely powerful at the same time, here is what it is:
- On the last day of the year, after the market closes determine which of the 10 stocks of the 30 in the Dow Jones Index, had the highest dividend yield.
- Divide the money you wish to invest into 10 equal parts, and invest each part in each of the stocks you selected in the first step.
- Enjoy your life and at the end of the year repeat the steps – find the stocks in the Dow Index paying the highest in dividends and restructure your investment, if needed. Hold another year and so on…
YEAH…! It’s that simple! And it has been really profitable so far. You don’t need to work, no efforts are needed, no special knowledge… All you need is a phone call to your broker and patience!
Some Things You Should Consider About The Strategy
* This is a long-term investment, and you will save some taxes if you are in the US.
* Try to minimize the transaction and ownership costs, by selecting the right stock broker for your investment.
* Since 1973, there have been years in which The Dow Jones Index outperformed “The Dogs Of The Dow”. You should know that this strategy is a long-term investment and don’t expect to have the exact 17.7 % every year! There will be ups and downs, but in the long run, the results should be great!
Some more thoughts about the Dogs of the Dow investment strategy
The “Dogs of the Dow” Investment Strategy has been popular since the early 1990s. It is a simple investing strategy that has been used by many investors to try and maximize returns on their stock portfolio.
Proponents of the Dogs of the Dow Strategy argue that, although the risk is high, the higher dividend yields and potential capital gains can give investors a better return than they would have achieved with a traditional index fund. Furthermore, they say the strategy’s simplicity makes it ideal for novice investors.
Critics, however, argue that the strategy is too simplistic and ignores the risks associated with investing in individual stocks. Further, they point out that by limiting the selection to just the 10 Dow stocks, investors are significantly reducing their exposure to a broader universe of stocks.
Ultimately, the Dogs of the Dow strategy may not be suitable for everyone, but it can offer investors a simple way to generate higher returns than traditional index funds. Investors should always exercise caution and do their own research before investing in any strategy. At the end of the day, the Dogs of the Dow can be a useful investment strategy for some investors, but it’s important to understand both its strengths and weaknesses before beginning. It’s recommended that investors use the Dogs of the Dow in conjunction with a wide variety of stocks and other strategies to achieve the best possible returns in their portfolio.
The author of this article does not guarantee anything and is not responsible for the future performance of this strategy. This article is for educational purposes only and is based on facts that are completely real.