Below we list the performance of the various categories of Dow Jones Industrial Average stocks as compared to the index.
The category highlighted in red is the original “Dogs of the Dow” where the ten highest yielding stocks are bought and held for one year and sold at the end of the year. So far, the Dow is beating the Dogs of the Dow by almost 5%.
When contrasting the performance of the Dogs of the Dow against taking the opposite category, stocks providing the lowest dividend yield, we see that across all groupings, the Dogs of the Dow consistently underperform.
For each group, the data set that is thought to be “bad” generally outperformed the category that typically is thought to be “good.” For example, the highest p/e stock bet lowest p/e stocks, lowest yield stocks beat highest yield stocks and highest p/b stocks beat out lowest p/b stocks (except top 2,3,4) .
Worth noting is the fact that the top 2,3,4 group of stocks only outperformed the top 1,2,3 group of stocks in both of the p/e categories. This is a stark contrast to what we indicated occurred in prior years of data.