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Archives for June 2026

The Evolution of the Dow Jones Utilities Average Index

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By Johannes @ Adobe Stock

In 1929, Dow Jones spun out utilities from its main index and created the Dow Jones Utilities Average Index. The original components of the average were:

  • American & Foreign Power
  • American Gas & Electric Co.
  • American Power & Light Co.
  • American Telephone & Telegraph
  • American Water Works & Electric Co.
  • Brooklyn Union Gas
  • Columbia Gas System
  • Consolidated Gas System
  • Consolidated Edison
  • Niagara Hudson Power
  • Southern California Edison
  • Electric Power & Light Co.
  • Engineers Public Electric
  • International Telephone & Telegraph
  • National Power & Light
  • North American Co.
  • Pacific Gas & Electric
  • Public Service Co. of N.J.
  • Standard Gas & Electric Co.
  • Western Union Telegraph

Unlike the Dow Jones Industrials and the Dow Jones Transports, the Utilities index hasn’t been changed much since its inception. There have, of course, been consolidations and name changes along the way, but many of today’s components have roots among those from 1929. Today’s list includes (along with dividend yields as of 6.16.26):

Company Symbol Yield
Atmos Energy Corp. ATO 2.36%
Vistra Corp. VST 0.56%
American Electric Power Co. Inc.  AEP 2.92%
American Water Works Co. Inc. AWK 2.80%
Duke Energy Corp. DUK 3.39%
Consolidated Edison Inc. ED 3.28%
The Southern Co. SO 3.22%
Sempra SRE 2.86%
NextEra Energy Inc. NEE 2.89%
Public Service Enterprise Group PEG 3.32%
Xcel Energy Inc. XEL 3.00%
Edison International EIX 4.85%
Dominion Energy Inc. D 3.90%
FirstEnergy Corp. FE 3.90%
Exelon Corp. EXC 3.62%

You can see that, without dividends even factored in the Dow Jones Utilities Index has grown in value through time since its inception in 1929.

But look again at the index since 1987 and compare its price return (no dividends) and its total return (dividends reinvested), and you’ll see the power of dividends and compound interest on returns. 

 

Ben Graham: Margin of Safety

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By DigitalArt Max @ Adobe Stock

In 2001, I wrote about Ben Graham and his Margin of Safety:

Creating Wealth Through the Power of Compound Growth

Ben Graham, 1894-1976…

Warren Buffett has referred to Benjamin Graham’s The Intelligent Investor as “by far the best book on investing ever written.” John Train, a former super Forbes columnist, wrote, “Graham ranks as this century’s (and perhaps history’s) most important thinker on applied portfolio investment.”

In the preface to Graham’s fourth revised edition printed in 1973, W.B. wrote, “It is rare that the founder of a discipline does not find his work eclipsed in rather short order by successors. But over forty years after publication of the book (first written in 1949) that brought structure and logic to a disorderly and confused activity, it is difficult to think of possible candidates for even the runner-up position in the field of security analysis.”

In preparation for writing to you this month, I reread The Intelligent Investor in order to be able to give you a little of the meat from Ben Graham’s seminal work. I practice these principles myself in my own investing, for my family accounts, and for you. I hope you’ll benefit from my Benjamin Graham menu for the rest of your investing days.

Your Cornerstone
  1. “Diversification is an established tenet of conservative investment. By accepting it so universally, investors are really demonstrating their acceptance of the margin-of-safety principle, to which diversification is the companion.”
  2. “The ‘aggressive’ investor should start from the same base as the defensive investor, namely, a division of his funds between high-grade bonds and high-grade common stocks bought at reasonable prices.”
  3. “To enjoy a reasonable chance for continued better than average results, the investor must follow policies which are (1) inherently sound and promising, and (2) not popular in Wall Street.”
  4. “One of the most persuasive tests of high quality is an uninterrupted record of dividend payments going back over many years. We think that a record of continuous dividend payments for the last 20 years or more is an important plus factor in the company’s quality rating. Indeed the defensive investor might be justified in limiting his purchases to those meeting this test.”
  5. “Stock trading is not an operation which, on thorough analysis, offers safety of principal and a satisfactory return.”
  6. “Outright speculation is neither illegal, immoral, nor (for most people) fattening to the pocketbook.”
  7. “In an astonishingly large proportion of the trading in common stocks, those engaged therein don’t appear to know–in polite terms–one part of their anatomy from another.”

These words remain as true today as they were then.

Originally posted November 3, 2025.

The Magic of Compound Interest

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UPDATE 6.15.26: Despite the many changes the world has seen since 2017, and all the chaos it endures today, my basic investment tenets haven’t changed. I wrote in 2017 (now itself, nearly a decade ago):

Well, writing to you now, five decades later, from our outside kitchen/living space in the heart of Old Town, Key West, I can’t help but think how much water has gone under the bridge through the many decades. But if you have been with me over the years, you are keenly aware that it is indeed the combination of dividends, compound interest, perspective and patience that frames the message I deliver to you month after month. I do not change course. You can count on it.

Originally posted April 5, 2022.

Back in 1964, I began a lifelong mission as a disciple of compound interest investing. In those earliest days, home base was Clayton Securities at 147 Milk St. in Boston’s financial district.  

By 1971 I had gotten into institutional trading and research with Model, Roland & Co. on Federal Street. My first accounts were Fidelity Investments and Wellington Management. 

Today, over 50 years have somehow flown by, and I am still doing business, a whole lot of it, daily with Fidelity (my family investment firm’s custodian) and Wellington (my own account’s largest positions). 

Wellington, for its part, manages billions of dollars in client assets for Vanguard. In the late 80s and early 90s, my friends at Vanguard let me know that my newsletter was responsible for directing more assets Vanguard’s way than the rest of the newsletter industry combined.  

Jack Bogle, the founder of Vanguard, was a friend of mine from Jack’s days at Wellington., Jack provided the key testimonial for my first book.

The focus and foundation for my five-decade adventure has been rooted in one little phrase: compound interest. The accompanying photo is my tattered little Union Carbide spiral booklet.

In 1992, Debbie and I bought a little pink Conch cottage in Old Town, Key West, just 90 miles from Cuba. Our son Matt has been our president since, and our daughter Becky is our chief financial officer. E.J. (Your Survival Guy), our son-in-law, after a valued internship with Fidelity, is director of client services.

I continue to research and write seven days a week on behalf of our firm’s clients. Debbie and I still live in Key West, and we do a lot of our research in the 8th arrondissement of Paris. The six-hour time difference works to our favor in getting material to our editorial staff back in Newport, RI.

Thanks to one basic concept – compound interest – I have been able to comfortably and with astounding consistency plot the course for our ultra-conservative, balanced investment firm for over five decades. 

You can bet that Debbie and I were pretty proud when our son Matt recently called to tell us that Barron’s had informed him that he had been selected to Barron’s Hall of Fame (2012-2022), while CNBC had just ranked our modest investment management firm #5 in America (2021) out of more than 14,800 registered investment companies. I guess when all is considered, there is a lot of good that be said about compound interest, consistency, and the value of the Prudent Man Rule. Disclosure

As they say, “It works for me.”

Dick Young
Old Town Key West  
5 April 2022
90 miles from Cuba

Richard C. Young & Co., Ltd.

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Disclaimer:

The information contained here is for informational and educational purposes only. It is not intended nor should it be considered investment advice or a recommendation of securities. Past performance is not a guarantee of future results. It is possible to lose money by investing. You should carefully consider your investment objectives and risk tolerance before investing.