Are you getting the best rate from your broker?
Compare your broker's rates now to find out if you can save money

Choose your broker below
Welcome to Dividend.com. Please help us personalize your experience.

Select the one that best describes you
Dividend logo

Most winning stock market strategies tend to lose their effectiveness over time, assuming they actually worked in the first place, because their popularity erodes their value.

The “Dogs of the Dow” strategy is one that still often works. Here’s how and why, and what it says.

Highest-Dividend Stocks

First articulated in 1991 by money manager Michael B. O’Higgins, the strategy calls for annually buying the ten Dow Jones Industrial Average stocks whose dividends are the highest fraction of their price. The theory, which O’Higgins said he back-tested to the 1920s, is that a blue-chip, Dow stock’s dividend is a more reliable indicator of a company’s value than its fluctuating stock price. This should mean that companies with a high dividend yield relative to their stock price are near the bottom of their business cycle and are likely to see their stock price increase faster than low-yield companies.

To read the Full Story, Go Premium or Log In

Popular Articles

News

U.S. Bancorp Increases Dividend by 23.33%

Each day, companies and funds across the globe announce upcoming dividend payouts. In our ...

News

How the Biggest GICS Structure Changes Impact Dividend Investors?

Since inception almost two decades ago, the Global Industry Classification System (GICS) has been...

News

Medtronic Plc. Leads 238 Securities Going Ex-Dividend This Week

There are 238 securities going ex-dividend this week starting Monday, September 24th. For income...