Dogs of the Dow is an investment strategy that has been around for over 30 years. It used to be popular, but this strategy has since faded away for more contemporary ones.
However, it does not mean that the strategy is inferior; it is just not in vogue.
The strategy is a simple one. It’s about looking for cheap blue chip stocks with higher yields relative to their peers.
The original Dogs of the Dow
The Dogs of the Dow strategy centres on the 30 blue chips in the Dow Jones Industrial Average (DJIA) index. Most investors will find comfort in the well-known, and familiar names as these are the most important enterprises in the country. These blue chip companies are believed to be ‘safer’ because they are expected to weather market and economic downturns better than smaller companies.
The resilience suggests that any share price corrections to these blue