Daily Posts Archive

Even though the market rebounded heroically in October, that August correction was just too strong to overcome. Cabot’s growth advisories protected subscribers by moving heavily into cash when things were stormy, but we didn’t have the kind of steady tailwind from the market that produces bushels of big performers. Today I would like to review three top performers of 2015.

The “Dogs of the Dow” is an investing strategy that involves trading only once a year, as the calendar rolls over. Over time, the strategy has a track record of slightly outperforming the Dow itself, beating the index in 9 of the last 14 years, albeit by an average of 1%. But the strategy’s most attractive characteristic—aside from its catchy name—is its simplicity. All you do is buy the 10 highest-yielding stocks in the Dow Jones Industrial Average at the beginning of each year. Next year, you replace any stocks that are no longer among the 10 highest yielders.

If you had invested exclusively in the S&P 500 ETF (SPY) last year, you would have finished the year down 0.81%. But if you had applied the very basic options strategy called a Buy-Write, you would have easily beaten those results.

One of my favorite ways to find leading stocks is to look at the list of stocks hitting new highs, to see if there are any new names popping up. So in preparation for 2016, I took a look at the stocks that were hitting new highs on the NYSE late last week.

Last week, Apple presented the bad news that iPhone sales growth has been slowing, and the stock gapped down in response. AAPL is now 29% off last year’s high (hit in April), and more and more investors are wondering what they should do with Apple—buy, hold or sell.