3 “Dogs of the Dow” Paying Up to 4.3%

The “Dogs of the Dow” are back. And this year, the biggest dogs are not just generous yielders – they’re cash cows with price upside to boot. For the uninitiated, the Dogs of the Dow strategy is simply buying the 10 Dow Jones stocks with the highest yields, typically at the beginning of a given year. The basic premise is that, when it comes to blue-chip stocks, high relative yields are the best sign of value. They simply highlight firms at the weakest part of their business cycles. Blue chip names are rarely cheap, which is why we only want to buy them when their businesses are in the tank. As sales and profits recover (as they almost-always do), we enjoy outsized price gains along with our dividends. ... Read more