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Can "Dogs of the Dow" work with mutual funds?

edited April 2013 in Fund Discussions
Ping Skeeter:
Some people use the system of buying the worst stocks of the Dow each year and wait till they rotate back into favor. Once that happens the improved "Dog" after its run up is replaced by a new Dog.

I ask this question to determine if anyone has replicated this technique with mutual fund index funds or ETF's.

prinx

Comments

  • TedTed
    edited April 2013
    Dear prinx; SDOG uses the 'dogs' strategy. YTD up 13.69%
    Regards,
    Ted
    http://www.alpssectordividenddogs.com/
  • Ted
    That is what I have been looking for.
    Thanks so much!
    prinx
  • edited April 2013
    Hi prinx,

    There are two mutual funds that I know of that employ the Dogs of the Dow strategy to some extent.

    One is by Hennsey Funds and it ticker is HDOGX. I have linked it’s fact sheet below.

    http://www.hennessyfunds.com/PDF_files/FS TR.pdf

    Another one is by Sun America ticker symbol FDSAX and is one that I own. I have linked information on this fund below. It is a minority position for me in my domestic growth & income sleeve with a weighting of about ten percent.

    https://www.safunds.com/pdf/Fund-Fact-Sheets/asset_upload_file840_6007.pdf

    Hope this helps.

    Skeeter
  • Skeeter thanks for your thoughts on the topic.
    You mentioned you owned FDSAX. With the below information obtained from MarketWatch
    What is your rational for picking FDASX over HDOGX. with the information below especially the 5.75% load and the inferior annualized returns that FDASX has?
    prinx

    Symbol Fund Name 1 Wk 13 Wk YTD. 1 Yr 3 Yr

    HDOGX Hennessy:Total Rtn;Inv 0.37% 7.44% 9.51% 13.21% 12.26%
    FDASX Fidelity Adv Gl Str;A 0.84% 2.90% 3.56% 8.41% 6.31%

    Symbol Fund Name Front Load E.R . Exp 12-B
    HDOGX Hennessy:Total Rtn;Inv 0.00% 1.29% 0.15%
    FDASX Fidelity Adv Gl Str;A 5.75% 0.65% 0.25%
  • Dogs of Dow is a 'value' strategy in drag. Buy a good value leaning fund.

    If you really want to buy Dogs of Dow strategy, do not pay for an actively managed fund with high fees as manager does not do much. In particular do not pay load.
  • edited April 2013
    Reply to @prinx:

    Hello prinx,

    I have reviewed your post and have found that you must have mistyped the ticker symbol for Focused Dividend Strategy Fund (FDSAX) as FDASX which pulls up a Fidelity fund.

    Several of the things that I favor about FDSAX over HDOGX is it overall performance which you can easily see form the performance detail that I have linked below. According to Morningstar $10,000.00 invested ten years ago in FDSAX would have a today’s value of about $27,309.00 vs. $18,727 for HDOGX. In addition FDSAX makes it stock selection usually sometime in the fourth quarter and chooses ten stocks form the DOW 30 (Dogs of the Dow) and 20 stocks form the Russell 1000 based upon valuation, profitability and dividend yield. Looking back FDSAX has been the better overall performer of the two although HDOGX did have some years that bested FDSAX. I plan to continue to add to my position in FDSAX as I believe it to be a fine fund; and, I am indeed happy with what it has done for me.

    http://quotes.morningstar.com/fund/f?t=fdsax&region=USA

    http://performance.morningstar.com/fund/performance-return.action?t=FDSAX&region=USA&culture=en-us

    For some reason HDOGX did not take in the compairson when linked. To view this, simply click on expanded view, then click compare, and then enter the ticker HDOGX.

    Perhaps a revisit to your research might be warranted.

    Skeeter
  • Skeeter sorry about the above error.

    I have been following the free weekly " All Star Invest with an Edge". It gives me a very nice view of the broad markets and sector performance. I am going to start with ETF's. to trade sectors.

    I know you mentioned this site a few years back. Do you use the free weekly edition?
    Have you tried the "All Star Investor"pay for edition? What is you opinion of this edition?
    Thanks,
    prinx
  • edited April 2013
    Hello, prinx ...

    I follow Ron Roland's Leadership Strategy that is linked below to a certain point in the growth area of my portfolio and is where I adjust my equity allocation the most. If I am light in a certain area that Ron has greenlighted then I'll add a little ... but, if I feel I have an ample representation already present then I'll let it ride so to speak. I have found the strategy to be most beneficial and if you see money market moving upward in the pecking order then I'd start trimming my equity positions back.

    http://investwithanedge.com/leadership-strategy

    I think the Dogs of the Dow is a good strategy but I'd wait for a pull back in the market before I'd open any new equity positions myself. Remember the Sell In May strategy is closing in and a good number of investors follow this strategy including myself.

    Let us know how you progress.

    Skeeter
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