Dogs of the FTSE 2018 – final update

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Just a quick update to say that I’ve reached the twelve-month mark for my 2nd experimental Dogs of the FTSE portfolio.

So how did the mutts perform with the markets going all pear-shaped towards the back-end of last year?

As a reminder, here’s 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]

Here’s how the 2018 portfolio looked after a year (as at 11th Feb 2019):

 

A very decent 8.77% gain, but if you include dividends, this becomes a mighty 16% gain for the entire portfolio! Nice!

Over this same period, the FTSE 100 Total Return was minus 2.02% so woo hoo, the Dogs romped home this year! 🙂

Ok, so most of the gains were from just one stock (Evraz) but with some other gains (eg National Grid and United Utilities), the small losses made little impact on the portfolio.

What’s Next?

I do intend to run a 2019 portfolio, or rather a 2019/20 portfolio but there will be a slight delay, because I’m going to wait til next tax year as I plan to use a different ISA account for this experiment.

So for now, I will just hang onto all the Dogs for a while longer and sell/buy when I am able to.

The Dogs will return in April!

17 thoughts on “Dogs of the FTSE 2018 – final update”

  1. Wow, that is an impressive performance! Especially considering the poor performance of the FTSE100 index. Which ISA provider have you been using? I currently just use Vanguard. They’re good because they’re cheap, but you can only buy Vanguard funds, which means I can’t try fun looking things like this (which is probably a blessing in disguise as, in my case, I’d probably start tinkering with the portfolio too much!).

    • Hi Dr FIRE

      I know, I wasn’t expecting them to do this well at all! It didn’t go so well last year and I thought it was going to be more of the same!

      I’m currently using AJ Bell Youinvest for this experiment – cost is £1.50 to purchase but £9.95 to sell. I’m waiting til the next tax year because by then, I should have access to the Freetrade app (https://freetrade.io/), where purchases and sales will be free. I wasn’t only planning on investing so much on a mere experiment but had to account for the fees. Zero fees will mean the optimum medium for this experiment! I will be doing a Freetrade app review once I’ve got my mitts on it!

      • iWeb is a good cheap platform; owned by the Halifax, so has that reassurance. £25 initial fee, and then £5/trade. Only thing you have to watch out for is that if you open an ISA, it automatically opens a share dealing a/c as well (and that can’t be deleted), so you have to double-check you’re in the right account before transferring money or buying shares (they are quite good at sorting out errors, though).

        • Hi Tina

          I did consider iWeb as an ISA provider but AJ Bell worked out marginally cheaper for my main portfolio, something like £48 vs £60 a year.

  2. I resurrected an old IPhone to take a look at Freetrade. A lot of work to be done but pretty good. Same boat as yourself – waiting for the Android version / 2019 ISA.

    • Hey Jim

      I had a peak of it as my boss has downloaded it, looks great already but as you say, still a lot of work to be done. Make sure your version of Android is 7 or more to be able to run the app!

  3. Oh good work! I’ve always had a warm spot for high dividend stocks. It’s why I’ve always had a draw to high yield portfolios.

    I reckon it’s the traditionalist in me that somehow feels that the point of a company is to make money. I know all of the theoretical and empirical reasons why just looking at dividends in problematic but there it is.

    Looking forward to see how you do in 2019!

    • Hi Caveman

      Agree that the underlying point is to make money, particularly if there are investors/shareholders, no matter what they say.

      Not sure I’d have the stomach to invest much more than what I’m experimenting with, although when I’m making the gains like this, I wish I had, haha!

  6. Jesus, well done! See, it’s an easy strategy to follow and it has beaten the market and many of the so called financial experts. May I ask you where did you hear about this strategy for the first time?

      • Hi Tony

        I first came across the strategy when one of the participants in my Monkey Stocks league used the strategy and ended up winning the league! The idea originated in the US, in that case, the Dogs of the Dow, with the UK equivalent being Dogs of the FTSE.

        I use this website to determine which Dogs to include in my portfolio: https://www.dividenddata.co.uk/dividendyield.py?market=ftse100&sort=yield&order=1

        I leave out any stocks I already have in my portfolio and any which have declared a cut in dividend.

        Ordinarily, I would have sold the ones no longer in the top ten and replaced with new ones (as it has been a year), but as mentioned, I am waiting until the next tax year.

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