|
Over the last twelve months, we've witnessed one of the most volatile stock markets in several years. As we start a new year, it's time to announce the Dogs of the Dow for 2012. After experiencing losing years in 2007 and 2008, the Dogs bounced back with positive gains over the last three years.
Dogs of the Dow Performance
The Dogs of the Dow ended 2011 with a double-digit gain. In addition, the Dogs outperformed the Dow Jones Industrial Average, as well as the S&P 500 Index for the second year in a row; thereby meeting the objective of this investment approach.
In 2011, the S&P 500 finished the year with a 0.0% gain (up only 0.04 points), the DJIA closed out the year with a gain of 5.5%, while the Dogs were up 12.2%. This means the Dogs of the Dow Theory met its goals again last year, since it beat these two benchmark measures of stock market performance. Overall, the Dogs of the Dow Theory proved to be a winning investment strategy three times over the last five years. This is a very encouraging outcome for this investing approach, which under-performed these measures in the years 2007 and 2008.
Some of the bigger Dogs in 2011 include DuPont (-7.44%), Microsoft (-6.74%), and General Electric (-0.33%); three companies that had negative returns on the year and failed to beat the S&P 500 Index. This is a surprising result for blue chip stocks, especially during what eventually became another comeback year for the Dow Jones Industrial Average.
2012 Dogs of the Dow
It's only possible to announce the 2012 Dogs of the Dow after the last trading day of any given year. Fortunately, the criteria for choosing these new Dogs are simple:
The 2012 Dogs can be found in the following table:
Dogs of the Dow 2012
| Stock Symbol |
Company Name |
2011 Close |
Dividend Yield |
| T |
AT&T Inc |
$29.87 |
5.89% |
| VZ |
Verizon Communications Inc |
$39.98 |
5.00% |
| MRK |
Merck & Co Inc |
$37.90 |
4.43% |
| PFE |
Pfizer Inc |
$21.83 |
4.03% |
| GE |
General Electric Co. |
$18.23 |
3.73% |
| DD |
Du Pont De Nemours |
$46.17 |
3.55% |
| JNJ |
Johnson & Johnson |
$65.98 |
3.46% |
| INTC |
Intel Corp |
$24.40 |
3.44% |
| PG |
Procter and Gamble |
$66.67 |
3.15% |
| KFT |
Kraft Foods Inc |
$37.74 |
3.07% |
If you look back at the 2011 Dogs of the Dow, then you'll notice two of the dogs were replaced in 2012. McDonald's and Chevron were removed from the list, while Procter and Gamble and General Electric were added to the 2012 Dogs.
Dow Theories
The Dogs of the Dow Theory was first popularized by Michael O'Higgins in his book Beating the Dow, published back in 1992. If you're interested in learning more about the assumptions behind this investing strategy, then read our complete article on Dogs of the Dow. That publication explains more of the history behind this approach, including the steps you need to follow if you want to invest in each of these companies. It also contains a list of the Dogs of the Dow for prior years, as well as the historical performance of the Dogs over the last eleven years.
About the Author - Dogs of the Dow 2012
Copyright © 2012 Money-Zine.com
|
Home 
Investing 