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Don’t Make Me Say I Told You So 101
matter of time before the company’s prospects improve, and
the stock price goes higher. If these stocks don’t rebound
quickly, stockholders get a nice oversized dividend yield while
they wait. When the stock price does rebound, investors get the
value appreciation in addition to the dividends. Because the
stock is beaten down in price relative to other stocks of its kind,
as determined by the larger dividend yield, the philosophy is
that there isn’t a lot of downside risk.
As an example of a large-cap value portfolio, here are the
top ten holdings of one of the largest large-cap value funds,
the Vanguard Value Index Fund (VIVAX). This information is as of
February, 2020:
Top Ten Equity Holdings
Berkshire Hathaway Inc. 3.18%
JPMorgan Chase & Co. 2.99%
Johnson & Johnson 2.77%
Proctor & Gamble Co. 2.24%
Exxon Mobil Corp. 2.13%
AT&T Inc. 2.06%
Bank of America Corp. 2.05%
UnitedHealth Group Inc. 2.01%
Intel Corp. 1.88%
The Walt Disney Co. 1.88%
Source: Vanguard, 2020
Chapter 3: You Must Have Growth In Your Portfolio
