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Strategy

Dogs of the Dow

The 10 highest-yielding Dow stocks each year.

Medium-termLow activityMichael B. O'Higgins

Core idea

A mechanical strategy: each year you buy the ten Dow Jones Industrial Average stocks with the highest dividend yield, equally weighted. After a year the portfolio is rebalanced.

How it works

Once a year: compute dividend yields for all Dow stocks, pick the top 10, equally weight them, hold, and repeat next year.

Pros

  • Rule-based and simple to run
  • Limited to large, established companies

Cons

  • Focused on a single index (US)
  • High yield can signal trouble
  • Annual rebalancing creates costs and taxes
Known for
Michael B. O'Higgins

For educational and informational purposes — not investment advice, not a recommendation to follow this strategy.