Dogs of the Dow, Nianhuibao 10.8%

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Dogs of the Dow, Nianhuibao 10.8%

http://www.dogsofthedow.com/

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The Dogs of the Dow is an investment strategy popularized by Michael B. O'Higgins, in 1991 which proposes that an investor annually select for investment the ten Dow Jones Industrial Average stocks whose dividend is the highest fraction of their price.

Proponents of the Dogs of the Dow strategy argue that blue chip companies do not alter their dividend to reflect trading conditions and, therefore, the dividend is a measure of the average worth of the company; the stock price, in contrast, fluctuates through the business cycle. This should mean that companies with a high yield, with high dividend relative to price, are near the bottom of their business cycle and are likely to see their stock price increase faster than low yield companies. Under this model, an investor annually reinvesting in high-yield companies should out-perform the overall market. The logic behind this is that a high dividend yield suggests both that the stock is oversold and that management believes in its company's prospects and is willing to back that up by paying out a relatively high dividend. Investors are thereby hoping to benefit from both above average stock price gains as well as a relatively high quarterly dividend. Of course, several assumptions are made in this argument. The first assumption is that the dividend price reflects the company size rather than the company business model. The second is that companies have a natural, repeating cycle in which good performances are predicted by bad ones.

O'Higgins and others back-tested the strategy as far back as the 1920s and found that investing in the Dogs consistently outperformed the Market as a whole. Since that time, the data shows that the Dogs of the Dow as well as the popular variant, the Small Dogs of the Dow, have performed well. For example, for the 20 years from 1992 to 2011, the Dogs of the Dow matched the average annual total return of the Dow (10.8%) and outperformed the S&P 500 (9.6%) as reported by the Dogs of the Dow website located at dogsofthedow.com. The Small Dogs of the Dow, which are the five lowest priced Dogs of the Dow, outperformed both the Dow and S&P 500 with an average annual total return of 12.6%.[1] When each individual year is reviewed it is clear that both the Dogs of the Dow and Small Dogs of the Dow did not outperform each and every year. In fact, the Dogs of the Dow and Small Dogs of the Dow struggled to keep up with the Dow during latter stages of the dot-com boom (1998 and 1999) as well as during the financial crisis (2007-2009).[2] This suggests that an investor would be best served by viewing this as a longer-term strategy by giving this portfolio of stocks time to recover in case of a rare but extreme economic event (e.g. dot-com boom, financial crisis). While most any investor can back test an investment system that performed well over the recent past (data mining), what is unique about the Dogs of the Dow in this regard is that it has been forward tested for over two decades which included multiple booms and busts.

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DOW 30 Dividend Yield
http://bbs.wenxuecity.com/finance/3104748.html

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看这个：dogs of dow
http://bbs.wenxuecity.com/finance/3104749.html

来源: momentumtrade 于 2013-02-13 17:18:59

Investment Symbol 2006 2007 2008 2009 2010 2011   1 Year 3 Year 5 Year 10 Year 20 Year
Dogs of the Dow - 30.3% 2.2% -38.8% 16.9% 20.5% 16.3%   16.3% 17.9% 3.4% 6.7% 10.8%
Small Dogs of the Dow - 42.0% 4.2% -49.1% 19.3% 15.4% 19.2%   19.2% 18.0% 1.8% 7.7% 12.5%
Dow Jones Industrial Average - 19.1% 8.9% -31.9% 22.7% 14.1% 8.4%   8.4% 15.0% 4.4% 6.1% 10.8%
S&P 500 - 15.8% 5.5% -37.0% 26.5% 15.1% 2.1%   2.1% 14.5% 2.4% 5.0% 9.6%
Fidelity Magellan FMAGX 7.2% 18.8% -49.4% 41.1% 12.4% -11.6%   -11.6% 14.0% 2.3% 3.4% 8.8%
Vanguard Index 500 VFINX 15.6% 5.4% -37.0% 26.5% 14.9% 2.0%   2.0% 14.5% 2.4% 4.9% 9.5%

牛二买刀

一旦算复利，就没意思了。

假设最初资金100, 每年的账户金额是:
Dogs of Dow: 130.3, 133.16, 81.49, 95.27, 114.80, 133.51
5% 定期存款: 105, 110.25, 121.55, 127.62, 134

牛二买刀

Small Dogs of Dow 更差
Small Dogs of Dow: 142, 147.9, 75.3, 89.8, 103.68, 123.59

但比ＳＰＸ好
SPX: 115.8, 122.169, 76.96, 97.36, 112.06, 114.41

silicon_beaver