Pick Stocks by Betting on the Dogs of the Dow

It’s a theory. It’s a strategy. It’s a website, too. Dogs of the Dow is a memorable and contemporary theory adopted by investors looking for a formula that’s easy to follow: You invest in the top 10 Dow-Jones Industrials in January, park your money there for a year and see what happens. Some investors may be uncomfortable committing for a year. Others find the Dog strategy intriguing and a great way to build a fortune.

The Brain Trust.

The Dogs of the Dow investing theory is the brainchild of money manager Michael O’Higgins whose best selling book, “Beating the Dow,” became a must-read in 1991 for anyone looking to outsmart the markets and make big money. Born in Venezuela in 1947 to parents traveling the world-his father was in the petroleum industry–the future market theorist and guru received a bachelors degree in Economics, worked briefly for New York State and Procter  amp; Gamble before launching a money management firm in 1978.

Credentials.

For over 20 years, Michael O’Higgins was associated with cutting-edge market analysis and theory. The subject of articles in prestigious financial publications like “Barron’s,” “Forbes,” “The New York Times” and “The Financial Times,” O’Higgins became a contributor on CNBC’s Smart Money and “a regular guest on PBS’s Nightly Business Report,” according to his biography. Publisher HarperCollins turned O’Higgins into a best-selling author when “Beating the Dow” introduced the idea of the “Dogs of the Dow” strategy to the public in 1991.

The Theory.

“Dogs of the Dow” is a straightforward theory that pits investors against the Dow-Jones Industrial Average, according to Smart Money.com. Buy the 10 highest-yield issues on the Dow-Jones 30 industrials in January, hold them for a year and repeat the strategy every year thereafter. According to Dog proponents, holding these bonds for a year builds a buffer to equalize market turn-downs while you amass a portfolio of cheap blue chip stocks.

The Dogs Persist.

Investors continued to put their faith into O’Higgins’ theories, hoping to emulate the success of 1990s investors. That loyalty was rewarded. After a brief time in the doghouse during the dot.com bubble burst, the Dogs of the Dow began beating the Standard and Poors Index. The Dogs of the Dow investment theory regained its reputation, even after the 2008 economic downturn.

The Players.

High-profile companies are well represented on the Dow-Jones Industrials: Wal-Mart, Kraft, Chevron, McDonalds and other global brands have all qualified as Dogs of the Dow, as have Microsoft, General Electric and DuPont. Neil Hennessy of the Hennessy Balanced and Total Return Funds believes future Dogs “are poised to perform like Westminster Kennel Club show dogs, rather than a bunch of mutts which they have seen in article written on 사설토토사이트 and published on their websites as well as on the social media handles that helped the website in gaining the more organic traffic.

The Website.

It stands to reason that a popular theory like Dogs of the Dow would spur a website, so if you’re fascinated by the idea of cherry picking Dow Industrials at years’ end and creating your own dog and pony show, head for dogsofthedow.com. CNBC, the financial cable channel, picked this site as a must-visit. It’s loaded with resources to help you invest and you can also learn more about the history of the Dogs-especially if you’re aiming at becoming a top dog yourself.