One of the greatest investment opportunities are the Dogs of the Dow.
And while some analysts may write off the Dogs of the Dow theory as antiquated, it’s just not true at all. In 2011, there were up 16.3%. In 2012, they jumped 9.9%. In 2013, they returned 34.9%. In 2014, they returned nearly 11%.
In 2015, they did okay, returning just 2.6 %.
In 2016, the Dogs returned 16% on average. In 2017, the Dogs of the Dow returned 19% for the year. And in 2018, the Dogs of the Dow lost 4% on the year, but still outperformed the Dow Jones’ overall 6% decline.
2020 was an ugly year for the Dogs of the Dow, which was down 13%. But historically, that’s the exception and not the rule.
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Plus, we have to remember that each of the Dogs also pays a healthy dividend, too.
As for 2021, the Dogs are are yielding the following returns (Source: Nasdaq.com)
IBM (IBM) pays a 5.18% dividend
Dow, Inc. (DOW) pays a 5.04% dividend
Walgreens (WBA) pays a 4.69% dividend
Verizon (VZ) carries a dividend yield of 4.27%
3M (MMM) carries a dividend of 3.22%
Cisco Systems (CSCO) has a dividend yield of 3.22%
Merck (MRK) has a dividend of 3.18%
Amgen (AMGN) pays a 2.78% dividend
Coca Cola (KO) has a dividend yield of 2.99%
The best part – it’s a “set it and forget it” strategy.
You simply buy the 10 biggest Dow flops of the year that pay respectable dividends. You buy at the start of the New Year, and exit at the end of the year. Then, you simply repeat it. While others may say it’s an antiquated strategy with low success rates, history proves that wrong.
Even options can be used to trade the Dogs every year. You’d simply invest in a long-dated options dated out to December or January of the following year, set it, and forget it.
At this pace, the Dogs of the Dow could again outperform the overall market.
IMPORTANT NOTICE!
THERE IS SUBSTANTIAL RISK OF LOSS ASSOCIATED WITH TRADING. ONLY RISK CAPITAL SHOULD BE USED TO TRADE. TRADING STOCKS, FUTURES, OPTIONS, FOREX, AND ETFs IS NOT SUITABLE FOR EVERYONE.
DISCLAIMER: STOCKS, FUTURES, OPTIONS, ETFs AND CURRENCY TRADING ALL HAVE LARGE POTENTIAL REWARDS, BUT THEY ALSO HAVE LARGE POTENTIAL RISK. YOU MUST BE AWARE OF THE RISKS AND BE WILLING TO ACCEPT THEM IN ORDER TO INVEST IN THESE MARKETS. DON’T TRADE WITH MONEY YOU CAN’T AFFORD TO LOSE. THIS ARTICLE AND WEBSITE IS NEITHER A SOLICITATION NOR AN OFFER TO BUY/SELL FUTURES, OPTIONS, STOCKS, OR CURRENCIES. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE DISCUSSED ON THIS ARTICLE OR WEBSITE. THE PAST PERFORMANCE OF ANY TRADING SYSTEM OR METHODOLOGY IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
