Conceptual Paper of the Trading Strategy: Dogs of the Dow Theory (DoD)
17 Pages Posted: 1 Dec 2015
Date Written: June 4, 2014
Investment objective of yielding higher return at lower risk is one of the challenges faced by participants (mainly investors) in share market. With an aim of overcoming this common challenge, past scholars have tested various trading strategies and even proposed new strategies but the outcomes are still puzzling. These high evolutions pertaining to trading strategies that occurred in investment world are covering several aspects such as fundamental features (ratios of the companies) and the economic variables yet the results were discourage due to mix results reported. Ample of causes could attribute to these situations where one of the most identifiable reason was unpredictability in global economic condition. Thus, this paper attempts to focus on the high yielding strategy of Dogs of the Dow Theory as one of the trading strategy in constructing portfolio in which this strategy are distinctive from the common high yielding approaches. This paper consists of several parts, namely the evolution of the trading strategies and the empirical evidences supporting Dogs of the Dow Theory as a trading strategy.
Keywords: trading strategies, portfolio selection, high-yielding strategy, dogs of the dow theory
JEL Classification: G10, G11
Suggested Citation: Suggested Citation