“Second Wave” Dogs of the FTSE + Random Shares

My latest Dogs of the FTSE experimental portfolio was set up in June, so it’s time for an update on its progress – a shame I wasn’t able to time it when everything hit rock bottom in March.

Bad timing or not, I continue to follow the strategy as an experiment and will be documenting the bad times as well as the good (mostly bad, these days!).

Here’s a reminder of the Dogs of the FTSE strategy:

  1. Choose the ten FTSE 100 shares with the highest yield (subject to my criteria*)
  2. Invest equal amounts in all ten shares
  3. Hold for a year (give or take a week)
  4. At the end of the year, sell the ones no longer in the top ten, replace with new shares with highest yield
  5. Repeat from step 3

[*criteria being that shares already in my portfolio are not included, nor any where a dividend cut has been announced]

Note that this is part of my ‘fun’ portfolio and represents less than 1.5% of my Future Fund – it is not what I do as a main investing strategy. All dividends received are reinvested.

Wobbles

The stock market has been wobbling a little these past couple of months, reacting (or not) to world events, and my Dogs don’t appear to have done too well. Only 3 are in positive territory, the others are looking quite sorry for themselves:

Over the same period, the FTSE 100 Total Return was -6.22% so the Dogs are doing slightly worse at -6.76%.

However, if I include dividends received, it’s a loss of -4.09%, which is marginally better but still rather rubbish.

Well, the mangy mutts still have around 9 months to turn themselves around – I’ll do another update in a few months’ time.

Random Shares

My Random Share Portfolio is made up of free shares awarded to me whenever someone signs up to Freetrade* via my affiliate link, bagging us both a random free share (worth between £3 and £200) in the process.

A couple of recent free random shares I received

Here’s the full portfolio – it’s gotten a bit too big to do a full copy and paste.

I’ve kept most of the shares, occasionally selling when the odd one gains by >20%.

The money from sales of such shares have been invested into my Winter Rock Associates Fund 😉

Thanks to all who have signed up via my link in the past – hope you all got a decent free share!

5 thoughts on ““Second Wave” Dogs of the FTSE + Random Shares

  1. Hi Weenie, enjoyed reading the update as ever and your random free shares portfolio is starting to look quite impressive, well done. I’m interested in your dogs portfolio as I’m trying something similar in the hope of building an income based portfolio for the future. Can I ask what made you decide to sell and restart the strategy on a yearly basis versus perhaps holding more longer term particularly if a share is performing ok and still paying a reasonable dividend? Just wondering if it risks constantly throwing out the good and replacing with the biggest dog? But perhaps that’s the point. Anyways love the blog, its inspiring, keep the posts coming.

    • Hi Hopeful Firer

      The decision to sell after one year isn’t mine, it’s part of the original strategy, which is based on the US Dogs of the Dow strategy to rebalance with the ‘biggest dogs’ each year: https://corporatefinanceinstitute.com/resources/knowledge/trading-investing/dogs-of-the-dow/

      If it was down to my own preference, I would hang onto some of them, particularly if they are down as it hurts everytime I have to sell at a loss! But, following the strategy does remove any emotion away from the decision-making.

      My intention is to document the experiment for 5 years and this is the 4th year. Perhaps when I’m done, I will create my own strategy based on the Dogs (but hanging onto some of them a while longer!).

      Thanks for reading and stopping by!

      • Ahh thanks for explaining and sharing the article. And yes selling at a loss is never easy. It messes with our emotions of admitting defeat I guess. I used to be terrible at it but I’ve got better. What I do now is if I have a share that I’d like to buy, but perhaps not the free capital with which to buy it, I look at a share that I own which has maybe not been performing well and ask myself do I think I have more chance of recovering my losses staying in this share? Or are my chances better re-allocating that capital to the new share? I’ve found by doing that I’ve been more successful than hanging on to the original share. That might be something to consider to help your thought process when it comes to ditching poorly performing shares.
        Here here to the sun shining brightly on your portfolio in the future! 🙂

  2. A list created as of the 21st Oct would still have BAT, M&G ,Standard Life, Vodafone but add Aviva,BP,Evraz,Imperial Brand,Legal & General & Persimmon.
    BP is at 46 year low and goes ex-div on Nov 5th with div yield of over 7%
    Given your HK connection for what it is worth i have bought HSBC.It is at an 11 year low and in 2009 it was at an 11 year low from 1998.In Astrology there is the SunSpot Cycle where the sun will shine on every dog every 11 years!

    • Hi Simon

      I already hold BP in my main portfolio, hence why it’s not in this Dogs portfolio.

      Funny you should mention HSBC, I purchased a few shares (among a couple of others) this month – only a small amount with a bit of dividend income sitting in my account. I hadn’t really planned on adding to my individual stock holdings but as you pointed out, HSBC’s price is at an all time low.

      Let’s hope the SunSpot Cycle shines as you say! 🙂

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