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Category: Main > Business Opportunities previous next
Ad No. 6189
The World’s Most Successful Trading Strategy.
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Ad Number: 6189
Seller: tradingtips
City: Santa Monica ,USA
Zip Code: 90405
Country: United States
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Details
Price: $ - USD
Ad began: 1/2/18
Description

A common question among investors is how a strategy can work when a large number of investors already know about it. Researchers have shown that if a strategy is based on sound investing principles, it can work no matter how well known it is. This idea applies to the Dogs theory which has been well known for many years. Although most investors believe the theory dates back to the 1991 book Beating the Dow by Michael B. O’Higgins, we showed in our earlier article that the strategy was actually first written about in the June 1951 issue of the Journal of Finance. Although the strategy has been available to investors for more than 65 years, it still works because it is based on sound investing principles. Those principles are diversification, time and value.

First, the Dogs is a diversified strategy with five or ten holdings. It is important to hold several stocks within a strategy because any one stock can deliver a loss. On the other hand, any stock can deliver a gain. By diversifying, investors increase the probability of owning a stock that delivers a gain.
Second, this strategy gives stocks time to go up. Over the past twenty years, as the internet allowed investors to obtain real-time quotes and place trades quickly, expectations for rapid returns seem to have become common. During the bubble of the late 1990s, some day traders believed they could consistently achieve triple-digit gains and retire after just a few years of trading. Many of these traders lost large portions of their portfolios when the bubble ended and the market crashed. Since that time, general expectations of investors seem to have become more realistic but there are still many traders targeting large gains in short time frames. This is possible with some strategies but for many investors, it could be best to take a longer term perspective like the one-year perspective of the Dogs strategy.
A longer term perspective, expecting to hold positions for months or even a couple of years,

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