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Dear Fellow Investor,
This Is One of the Best Yearly Dividend Opportunities to Jump Into
If you’re looking for a simple, reliable, and historically resilient income strategy, the Dogs of the Dow remain one of the most compelling opportunities for long-term investors, especially heading into 2025.
For decades, this strategy has appealed to investors who want less guesswork, steady dividends, and exposure to some of America’s most established blue-chip names. And even though the Dogs don’t win every single year, the track record shows that over time, they consistently deliver competitive returns, with dividends often doing the heavy lifting.
Let’s take a deeper look at why the Dogs strategy continues to thrive, how it has performed over the past decade, and how the 2025 lineup is shaping up so far.
A Proven Strategy, Built on Simplicity
The Dogs of the Dow method is famously straightforward:
At the start of each year, you invest equally in the 10 highest-yielding Dow Jones stocks. Then you hold them for a year and repeat.
It’s one of the rare strategies that doesn’t rely on forecasting, macro predictions, or timing the market. Instead, it uses a value-based approach: selecting companies whose yields are elevated not because their dividends are unusually high, but because their stock prices fell during the prior year.
In many cases, these declines are temporary. As sentiment turns around and these blue chips rebound—as they historically tend to—investors earn both:
That combination has produced competitive returns for decades.
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The Track Record: A Mix of Outperformance and Stability
Like any strategy, the Dogs have up and down years, but what stands out is the long-term consistency.
2024: Underperformance on Paper... But Not for Income Investors
The 2024 Dogs lagged the major indices in total return.
But once dividends were factored in, income-focused investors still did well, especially compared to many actively managed strategies that struggled to keep up with the market’s AI-driven tilt.
2023: A Solid Gain Despite Coming in Below the Dow
The Dogs returned 10.1%.
The Dow returned 14.4%.
But thanks to strong dividends, total income often exceeded passive index yields.
2022: The Strategy Beat the Market in a Brutal Year
This was one of the most important test cases in recent memory.
A modest gain until you compare it to the carnage:
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NASDAQ: -33%
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S&P 500: -19%
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Dow Jones: -9%
A positive return in one of the worst market years since 2008 is a major validation of the Dogs strategy's defensive strength.
2021: +16.3%
Another strong year.
2020: A rare down year
The Dogs lagged—but recovered strongly the year after.
2019: +20%
2018: +1% (Beating the Dow’s -6%)
2017: +19%
2016: +16%
Across nearly every rolling multi-year period, the Dogs show impressive resilience, especially during periods of market rotation, recessions, and rising-rate environments.
2025 Dogs of the Dow:
This year’s lineup is looking good, especially considering the market’s volatility and concerns about overvaluation in sectors like AI and tech.
Here’s how each position has performed so far:
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Verizon (VZ)
Yield: 6.68%
Started the year near $38 and climbed to $41.35.
Defensive, high-yield telecom exposure continues to shine.
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Chevron (CVX)
Yield: 4.51%
Rose from roughly $142 to $151.
Energy prices remain supported, boosting earnings stability.
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Johnson & Johnson (JNJ)
Yield: 2.57%
One of the biggest winners: from $142 to $202.50.
A classic example of Dog-to-top-performer rotation.
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Amgen (AMGN)
Yield: 2.78%
Ran from $258 to $342.
Biopharma strength is driving momentum.
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Merck (MRK)
Yield: 3.57%
A rare pullback, sliding from $98 to $95.
Still attractive for long-term dividend growth.
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Coca-Cola (KO)
Yield: 2.86%
Climbed from $61 to $71.35.
Consumer staples remain a defensive anchor.
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IBM (IBM)
Yield: 2.31%
Surged from $215 to $291.
Hybrid cloud and AI services are accelerating.
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Cisco (CSCO)
Yield: 2.09%
Rallied from $58 to $78.
A long-time Dog showing strong recovery.
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McDonald’s (MCD)
Yield: 2.44%
Inched up from $293 to $304.
Global same-store sales remain a powerful growth engine.
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Procter & Gamble (PG)
Yield: 2.87%
The biggest laggard, falling from $264 to $147.
But historically, steep PG declines tend to revert.
Eight out of ten Dogs are positive year-to-date.
Factor in their dividends, and this has been one of the healthiest years for the strategy.
Why the Dogs Strategy Still Works
There are three key reasons why the Dogs of the Dow continue to deliver:
1. Blue-chip stability
These are companies with:
They tend to weather downturns better than high-growth or speculative tech stocks.
2. Value rotation tailwinds
The Dogs are, by design, last year’s laggards.
In mean-reverting markets, undervalued stocks often recover as sentiment shifts.
3. Dividends do the heavy lifting
Even in years when capital gains underwhelmed, dividend yields generated meaningful returns.
That’s what makes this strategy such an attractive yearly opportunity:
It thrives in up markets, down markets, and sideways markets.
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Have you had any luck trading the dogs of the DOW or with similar, year end trading strategies? What other sectors of the market are you currently interested in? Hit "reply" to this email and let us know your thoughts!
