Dogs of the Dow Investing: Does it Pay Off?

Dogs of the Dow is an investment system that many people have used for years now. It has been proven to work over the long term and is gaining more followers every year. Here are the basics of Dogs of the Dow investing and how it works.

Dogs of the Dow

Dogs of the Dow is a strategy that is sometimes referred to as the high-yield method. The strategy revolves around investing in stocks that produce a high yield and are in the Dow Jones Industrial Index. This system has produced an average rate of return of about 18 percent. This beats the index and most professional money managers as well. Therefore, it has definitely proven its worth as an investment strategy.

Choosing the Stocks

When selecting stocks with the Dogs of the Dow method, you will look for the stocks that have the highest yield in the Dow Jones index. This means that they pay a high dividend in relation to how much it costs to buy shares. Therefore, you will look at all of the information that is available to you about stocks in the Dow Jones and buy the top 10 stocks in this area. You need to purchase equal dollar amounts of each of these stocks for your portfolio.

Holding Method

Once you have purchased the top 10 stocks in this area, you will need to hold onto them. According to the system, you should keep them all for one year. After the year is up, you need to evaluate the stocks to see if they are still considered the highest yield stocks in the index. Look at the top 10 list of high-yield stocks again. If some of the stocks that you have are no longer in the top 10, sell them. Then purchase the stocks that you do not have within the top 10. At that point, you will hold your new group of 10 stocks for a year. At the end of that year, you will reevaluate the process again.

High-Yield Stocks

This method is referred to as the Dogs of the Dow because you are investing in stocks that are not highly desirable to the average investor. If a stock has a high yield, this means that the stock price has fallen but the company is still paying the same dividend. Therefore, you are dealing with companies that used to be more popular investments. You are counting on the high dividends to increase the amount of return that you can bring in during the year.


Using this strategy can provide you with some unique benefits. This strategy is extremely simple. Anyone can look at a list of stocks and choose the top 10 in a particular category. Besides being simple, the strategy really works. It is much more successful than many other investment strategies. Therefore, if you are looking for a strategy that is easy to implement and provides a good return, Dogs of the Dow might be what you are looking for

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