Dogs of the Dow 2018

By: DailyForex

Forex trading was unusually tricky in 2017, with many forces moving the market, making it difficult for many traders to find the profits they sought.  Though there were some winning strategies in 2017, many standard technical strategies yielded results that were less than stellar.  For this reason, many seasoned Forex traders have begun looking outwards to other assets, including cryptocurrencies and CFD trading.  Trading CFDs on assets is a bit different than trading the asset itself, and there are many benefits of CFD trading.

Traders interested in long-term gains, however, may prefer a different strategy that will yield results over a longer time frame.  One such strategy is the “Dogs of the Dow” strategy, through which traders purchase equal dollar amounts of the ten stocks with the highest dividend yield on the Dow Jones Industrial Average, with the expectation that they’ll profit both from the dividends and the increase in stock price over the year.   Looking at the long-term charts, the Dogs of the Dow tend to outperform the full Dow, and have enjoyed an average annual total return of 8.6 percent from 2000 through 2016, compared to the average annual return of the Dow, which was 6.9 percent in the same period. 

In 2017, the Dogs of the Dow had an average dividend yield of 3.6 percent, and 2018’s picks seem to have an average yield of 3.1 percent.  However, this shouldn’t deter committed long-term traders; most Dogs of the Dow are expected to raise their dividends in the coming year, and most are predicted to have higher price targets as well. 

Here are the Dogs of the Dow for 2018 and their current dividend yields:

Verizon (VZ) – 4.44%

IBM: 3.93%

Pfizer (PFE): 3.76%

Exxon Mobil Corporation (XOM): 3.67%

Chevron Corporation (CVX): 3.43%

Merck (MRK): 3.41%

Coca-Cola (KO): 3.25%

Cisco (CSCO): 3.01%

Procter & Gamble (PG): 3.00%

General Electric (GE): 2.74%

Sara Patterson has a Master’s Degree in political science and enjoys analyzing both current events and the international markets to get a fuller perspective of the currency market. Before turning to financial writing, she taught English writing skills to high-school age students. Sara’s work has been published on various financial and Forex blogs.