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Back on October 12th, we published this report on the performance of 2016’s “Dogs of the Dow” strategy, which says to simply buy the 10 highest-yielding stocks in the Dow Jones Industrial Average at the start of each year. (You can read more about the strategy at this Investopedia link if you’re looking to learn more about the reasoning behind it.)
In our October post, the 10 “Dogs of the Dow” for 2016 were absolutely crushing the non-Dogs. At that point, the Dogs were up 12% on the year, while the non-Dogs were up just 0.57%.
Obviously a lot has changed for the market since October 12th, so how are the two baskets doing now that two more months have passed? Well, the Dogs have continued even higher, but the non-Dogs have also done extremely well thanks to stocks like Goldman Sachs (GS) and JP Morgan (JPM).
Below is a look at the updated year-to-date performance of the “Dogs of the Dow” versus non-Dogs. As shown, the Dogs are now up 17.3%, while the non-Dogs are up 9.14%. The Dogs are still up nearly double the non-Dogs, but the non-Dogs have rallied more since our last update.
We’ll provide a final update on 2016 performance at the end of the year and post the official list of 2017’s Dogs as well. If the year ended today, Merck (MRK) and Wal-Mart (WMT) would be removed and Coca-Cola (KO) and Boeing (BA) would be added. We also thought it was worth noting that tech-giant Cisco (CSCO) is now the fourth highest-yielding stock in the Dow with a yield of 3.46%. That’s pretty remarkable when you think back to where the stock stood during the Dot Com heyday of the late 90s.