Dividend Suspension Tracker • Dogs of the Dow (2024)

FAQs

Is there an ETF that tracks the Dogs of the Dow? ›

The ALPS Sector Dividend Dogs ETF (SDOG) applies the 'Dogs of the Dow Theory' on a sector-by-sector basis using the S-Network US Equity WR Large-Cap 500 Index as its starting universe of eligible securities.

The Dogs of the Dow strategy involves picking the top 10 highest-yielding dividend stocks from the Dow Jones Industrial Average at the start of each year and holding them for 12 months.

The Dogs have historically boasted an outstanding long-term track record, but they've panted recently. The Dow Dogs lumbered behind the market in 2019, 2020, and 2021. They raced ahead in 2022, but they laid down once more in 2023.

And while there's no fund dedicated to the Dogs of the Dow (yet); the Invesco Dow Jones Industrial Average (DJD) does weigh its components according to dividend.

The Dogs of the Dow Step-by-Step Process

Using each part, buy shares in each of the ten Dow stocks listed in the first step. Hold these stocks until the end of the year. At the end of the year sell the existing Dogs and then repeat the overall process again.

Over the past five years, the Dogs have underperformed the S&P 500 and the Dow four times, including 2023. That slide has hurt the Dogs' relative investing stats. Over the past 20 years, from the end of 2023, the Dogs have returned just over 8% a year on average, including dividends.

Since 2000, the Dogs of the Dow has had an average annual return of 9.5% and the Small Dogs of the Dow has had an average annual return of 10%, according to dogsofthedow.com. Below are the 10 Dow stocks that qualify for a 2022 Dogs of the Dow portfolio with price/yield indications (the "small dogs" are in red):

Rebalance by selling your positions and re-allocating the capital into the new top ten dividend-yielding stocks determined in Step 2. For example, if the portfolio is now worth $15,000, the investor would sell his positions and re-allocate $1,500 to each of the new top ten dividend-yielding stocks on the Dow.

The term "dogs" refers to the strategy of looking for the highest-yield Dow stocks, which are typically the ones that are viewed as being out of favor with investors, or "in the doghouse." The Dogs of the Dow strategy has gained in popularity since Michael O'Higgins' book, Beating the Dow, was first published in 1991.

As a tactic, Dogs of the Dow goes like this—after the stock market closes on the last day of the year, select the 10-highest dividend-yielding stocks in the DJIA. Then, on the first trading day of the new year, invest an equal dollar amount in each of them.

What is the Dobermans of the Dow strategy? ›

The strategy simply buys the ten highest dividend yielding stocks in the Dow at the beginning of every year. Since dividend yield is the only criteria, it's a relatively easy strategy for individual investors to implement.

The new Dogs of the Dow

Eight of these stocks were in the 2023 Dogs of the Dow and are making a repeat appearance this year. The new members are Coca-Cola and Johnson & Johnson. The Dogs of the Dow usually deliver subpar performances during the year before they make the list.

The Dogs of the Dow strategy tells investors to invest annually in the ten Dow components whose dividend is the highest fraction of their price. In other words, you pick the ten Dow companies with the highest dividend yield.

As for the stock market during Biden's tenure, it trended higher, but with significant volatility. The benchmark S&P 500 generated impressive returns of 28.7% in 2021 and 26.29% in 2023. Sandwiched in between was a bear market, as the S&P 500, at its low point, dropped 25% in 2022.

Vanguard - Prospectus and reports. Online is the quickest, easiest, and most cost-effective way to transact with Vanguard. Lower costs may mean we can pass more savings on to you. SPDR® Dow Jones Industrial Average ETF Trust is offered by prospectus only.

Fidelity® Total Market Index Fund is a diversified domestic all-cap equity strategy that seeks to closely track the aggregate returns and characteristics of the Dow Jones U.S. Total Stock Market IndexSM.