July | 2020 | iMarketSignals

A simulation of this strategy with annual withdrawal rates of up to 10% still showed long-term growth which exceeded that of buy-and-hold the S&P 500 ETF (SPY).
The backtests use the FactSet stock database and FactSet’s Revere Business Industry Classifications System (RBICS).
The model holds equal-weight 10 stocks of the Russell 1000 index which are ranked with a simple ranking system to identify shares of the highest “quality” companies.
The strategy provides a high dividend yield because a minimum yield excess (depending on RBICS sector type) over the yield of SPY is a critirium for stock selection.
From Jan-2000 to Jun-2020 this strategy without withdrawals would have produced an annualized return (CAGR) of 21.5%, much more than the 5.6% CAGR obtained from SPY over the same period.