The Dogs of the Dow Didn't Hunt in 2020, and 2021 Isn't Looking Much Better
Not that anything about 2020 was normal, but a long-tenured, stock-picking approach failed last year -- big time. The so-called Dogs of the Dow strategy meant to identify undervalued blue chips underperformed the very narrow index from which it draws its picks.
Then again, that can't come as a complete surprise. These gimmicks sound reasonable enough on the surface. At the end of the day, though, nothing replaces good ol' common sense.
If you're not familiar with the premise, it isn't complicated. The Dogs of the Dow are the 10 Dow stocks sporting the highest dividend yields at the end of any given year. Buy them at the beginning of the next year and you should -- theoretically anyway -- outperform the Dow Jones Industrial Average that year.
Source Fool.com
