The 'FTSE Dogs' worth buying

Buying the ten highest yielders in the FTSE 100 - 'the dogs' - has proved successful in the past. Can it do so now, and which stocks should you buy? Tim Bennett investigates.

Ever since the financial crisis broke five years ago, the so-called Dogs of the FTSE' strategy has had a pretty rough time. But in recent months, it has started to outperform the market. So is it time to back the dogs once again?

Probably the best thing about it is its simplicity. US fund manager Michael O'Higgins first coined the phrase Dogs of the Dow' around 1991. He argued that you should aim to take full advantage of the fact that other investors act in herds. They pile into popular stocks, driving the price beyond any sensible valuation.

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GlaxoSmithKlinePharmaceuticalsLSE: GSK4.95%1,405
VodafoneTelecomsLSE: VOD5.38%175
SSEUtilitiesLSE: SSE5.55%1,423
National GridUtilitiesLSE: NG5.57%704
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BAE SystemsAerospaceLSE: BA6.00%306
AvivaInsuranceLSE: AV7.61%332
RSAInsuranceLSE: RSA7.93%114
ResolutionInsuranceLSE: RSL9.02%216

Tim graduated with a history degree from Cambridge University in 1989 and, after a year of travelling, joined the financial services firm Ernst and Young in 1990, qualifying as a chartered accountant in 1994.

He then moved into financial markets training, designing and running a variety of courses at graduate level and beyond for a range of organisations including the Securities and Investment Institute and UBS. He joined MoneyWeek in 2007.