Dogs and Dow

Understanding Dogs of the Dow

Because the Dow is one of the oldest and most widely followed indexes in the world—and generally is seen as a barometer for the broader market—it is not uncommon for market strategists to base investing techniques on some components of the DJIA. The main reason to follow the Dogs is that it presents a straightforward formula designed to perform roughly in line with the Dow.

Though not an entirely new concept, this strategy first became a popular fixture in 1991, following the publication of Michael B. O’Higgins’s book, Beating the Dow. In the book, O’Higgins also coined the name “Dogs of the Dow.”

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