Category Archives: high yield

Dogs of the Dow: 1994

In our continued pursuit to gather data that contradicts our view that low yield stocks outperform the high yield stocks (aka Dogs of the Dow) as presented in Michael O’Higgins’ book Beating the Dow, we have obtained the performance of the top ten, top five, top three and the 2nd, 3rd, and 4th stocks in the high and low yield groups then contrasted their performance against the Dow Jones Industrial Average for the same year.

In this case, the year under consideration is 1994 and we have added the list of ten stocks and their price with the dividend yield.

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1994 Data Breakdown

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After reviewing the data and adjusting for splits, the Dogs of the Dow (High Yield stocks) again underperformed the Low Yield stocks.

Average Return 1991-1994

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On average, from 1991 to 1994, the Low Yield stocks continue to outpace the Index and the High Yield (Dogs of the Dow) stocks at more than double the rate.

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Dogs of the Dow: 1993

In our continued pursuit to gather data that contradicts our view that low yield stocks outperform the high yield stocks (aka Dogs of the Dow) as presented in Michael O’Higgins’ book Beating the Dow, we have obtained the performance of the top ten, top five, top three and the 2nd, 3rd, and 4th stocks in the high and low yield groups then contrasted their performance against the Dow Jones Industrial Average for the same year.

In this case, the year under consideration is 1993 and we have added the list of ten stocks and their price with the dividend yield.

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1993 Data Breakdown

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This is the first year where High Yield stocks (Dogs of the Dow) exceeded the returns of the Low Yield stocks.

Average Return 1991-1993

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The average return for the period from December 31, 1990 to December 31, 1993 continues to show the Low Yield stocks exceeding the index in each grouping.  However, the High Yield stocks are gaining ground with the top ten stocks failing to prove their ability to beat the Index.

see also:

Dogs of the Dow: 1992

In our continued pursuit to gather data that contradicts our view that low yield stocks outperform the high yield stocks (aka Dogs of the Dow) as presented in Michael O’Higgins’ book Beating the Dow, we have obtained the performance of the top ten, top five, top three and the 2nd, 3rd, and 4th stocks in the high and low yield groups then contrasted their performance against the Dow Jones Industrial Average for the same year.

In this case, the year under consideration is 1992 and we have added the list of ten stocks and their price with the dividend yield.

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1992 Data Breakdown

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For the second year in a row, the top ten stocks in the high yield category underperformed the Dow Jones Industrial Average AND the low yield category.

Average Return 1991-1992

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The average return for the period from December 31, 1990 to December 31, 1992 highlights the strength of the low yield stocks.  However, for the top ten high yield stocks, they could not outperform the Dow Jones Industrial Average.

see also:

Dogs of the Dow: 1991

In our continued pursuit to gather data that contradicts our view that low yield stocks outperform the high yield stocks (aka Dogs of the Dow) as presented in Michael O’Higgins’ book Beating the Dow, we have obtained the performance of the top ten, top five, top three and the 2nd, 3rd, and 4th stocks in the high and low yield groups then contrasted their performance against the Dow Jones Industrial Average for the same year.

In this case, the year under consideration is 1991 and we have added the list of ten stocks and their price with the dividend yield.

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1991 Data Breakdown

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The data should be considered amazing because the exceptional yield that is offered by the high yield stocks (Dogs of the Dow) an investor generally foregoes nearly double the return.  Also notice that the high yield stocks had 4 of the ten companies on their list that failed (bankruptcy, forced liquidation) while only one company in ten on the low yield list has failed (so far).

see also:

Stock Market Dividend Yield: 1871-2020

This from Barron’s on the U.S. stock market dividend yield from 1871-1996:

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The Dow Jones Industrial Average dividend yield profile from 1920-2020: Continue reading

Chart of the Day: Inverted Yields from 1800 to 1965

Below is a chart of inverted yields of American bonds as published in Richard Russell’s Dow Theory Letters on May 25, 1965.  What is most conspicuous about this chart?  The overall trend of lower highs (yields) and lower lows (yields).

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HYG: Junk in a Funk

According to Yahoo!Finance, the high yield junk bond fund iShares iBoxx $ High Yield Corp Bond ETF (HYG) “seeks to track the investment results of the Markit iBoxx® USD Liquid High Yield Index (the ‘underlying index’).”

Since 2007, HYG has had the following performance:

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We have provided upside targets based on the intermediate peak of April 8, 2013 at $96.29 and the low of February 11, 2016 at $75.59. 

It can be safely said that HYG has a long-term trend with a downside bias.  All HYG needs to do is exceed the $92.87 to confirm a “stable” and “improving” market for high yield instruments.  Until that time, speculators in high yield products should pay close attention to the prospect of a potential double top and resistance to the long-term trend in the market that has been in place since 2007.