Dogs of the Dow is an investing strategy that buys and holds equal dollar amounts of the 10 best-yielding dividend stocks of the Dow Jones Industrial Average (INDEX: ^DJI ) . The strategy banks on the idea that blue-chip stocks with high yields are near the bottom of their business cycle and should do much better going forward. Investors in the strategy then would not only get large dividends but also gains in the stocks underlying those dividends.
Evidence compiled by Tweedy Browne refutes these falsehoods. Research shows that portfolios of high-yield dividend stocks outperform lower-yielding portfolios and the market in general. In fact, a study by noted finance professor Jeremy Siegel found that over 45 years, the highest-yielding 20% of S&P 500 stocks outperformed the S&P 500 by three times! The highest-yielding stocks turned a $1,000 investment in 1957 into $462,750 by 2002, compared with $130,768 if the same money was invested in the index.
Source: Motley Fool
Related Articles:
- Why We Are Dividend Growth Investors
- What Determines A Dividend Stock's Yield
- Managing Risk With Dividend Stocks
- 9 Stocks With a Sustainable Dividend
- 11 Low Beta, High Quality Dividend Stocks
Dogs of the Dow Are Outperforming the Dow
Posted by D4L | Monday, January 30, 2012 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
In an attempt to put a lid on inflation, the Federal Reserve has stated that it intends to raise its benchmark federal-funds rate by 0.25% a...
-
If you have contemplated selling shares of some of the companies you own this year, you likely aren't alone. Considering how volatile th...
-
Readers may want to do a stock valuation on the stocks in their favorite sectors and wait patiently until they become cheap. Patience is a v...
-
Dividend growth stocks are among our favorite investment groups because you get so much bang for your buck. Not only do the companies pay di...
-
Dividend Kings, stocks with at least 50 consecutive years of dividend growth, are favorites of many income investors. High-dividend yields c...
-
Dividend utility stocks might seem bad for your portfolio during high inflation and rising interest rates. However, the sector has done well...
-
Companies that have either been through past downturns or have the pricing power to offset the costs of inflation provide a crucial element ...
-
Dividend reinvestment plans, or DRIPs, can be effective ways to accumulate shares of high-quality companies for those with limited capital t...
-
Do you have the stomach for contrarian investing - betting against the crowd? Sometimes that's necessary in order to find value. Why buy...
-
We picked up two investments that carry excellent yields combined with some healthy upside in the share price. We also dropped one of our po...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.