Today I'm going to tell you something I probably
That's because it involves an investment strategy so easy and
so simple - with incredible returns - that if you use it, you'll
never need or want to read another newsletter in your life.
The reason why most people don't use this strategy is because
it's relatively boring. Most investors want lots of "action."
Like casino gamblers, people want to be in and out of the
game. Winning is a secondary concern to playing.
And as you'll see, this strategy works incredibly well over
the long term. We know that most people like to think they're
"long-term" investors, but we also know that the average holding
period for stocks is less than 6 months.
But if you are a long term investor (or you'd like to be),
here are the full details of how you can beat the market…
I call it "The Small Dogs of the Dow."
The Small Dogs of the Dow is a simple and effective strategy
that has outperformed the Dow and the S&P 500 significantly
over the last 20 years. Let me present this in simple terms:
"Small Dogs" of the Dow
So what is the "Small Dogs of the Dow?" And how does it
First, you must understand the Dogs of the Dow. These
are the 10 highest yielding stocks in the Dow Jones Industrial
Average. The strategy recommends buying these 10 high yield Dow
stocks at the beginning of each year, and rebalancing
annually. That's just one transaction per year…
The "Small Dogs of the Dow" offers a slight twist on this
winning strategy. And the results require your attention.
One of the key attractions of using the conservative strategy
is that it requires very little research or time. Simply take the
five lowest-priced Dogs of the Dow stocks and invest an equal sum
in each stock.
Every year, the whole process starts over. Oftentimes, most of
the stocks will remain on the list from one year to the next,
simplifying things from a taxation perspective (no gains or
losses to report) and also helping to lower commission costs.
In order of current yields, the 2013 Small Dogs of the Dow are
made up of the following stocks:
The Dogs have beaten the performance of the Dow 30 Industrial
Average in two of the last three years. But it's the long term
record that has me convinced that this is a winning strategy.
Of particular interest to income investors is the fact that
the Dogs start every year with a distinct advantage over the rest
of the Industrials. This time around it's a combined yield of
nearly 4%. Compare this with a yield of 2.6% for Dow Jones
Industrial Average, and the income advantage is clear.
And if you are interested in further increasing your Small
Dogs of the Dow performance, please make sure to check out next
week's issue of Income & Prosperity. I will discuss how I use
the Small Dogs of the Dow strategy as a foundation for doubling
my dividend, thereby further increasing the performance of the
market-beating strategy. Stay tuned!!!