Year-end yield rank rotation with a collapse veto

A closed index as a yearly book

The historical procedure ranked constituents of a closed blue-chip index by dividend yield at the prior year-end and held the ten highest-yielding names as a calendar-year book.

Value investing supplied the rank score. Seasonal analysis fixed the year-end review and the calendar hold. Rank rotation made buy, skip, and substitution the same testable signal instead of three separate habits.

Forward yield as the value score

The rank input used four times the last quarterly dividend over year-end price, not the sum of the prior year's paid dividends. A cut or a hike therefore changed the yield used for selection. That forward yield kept the shortlist a relative cheapness screen inside a closed universe.

Dividends were treated as reinvested each quarter into the same paying name, including odd lots and fractional shares.

The test book was built as 100 shares of each of the ten names at the start of 2000 rather than as a return computed from index levels alone.

Year-end review and a calendar hold

Selection sat at the prior year-end and the book was held for the calendar year that followed. The extra charting step was described as an annual review rather than a continuous overlay.

Seasonal analysis therefore sets the review cycle. The book is judged as a seasonal regime, not as a stream of standalone stock picks.

Collapse veto, reentry, and the ranked substitute

Before a ranked name was funded, a chart was reviewed for a one-to-eight-week collapse on expanding volume, with the heaviest volume at the low. Names that showed that collapse veto were skipped.

A skipped name could re-enter only after the reentry test: price stood above a 50-day average that was trending higher. The empty slot was filled by the ranked substitute, the next name on the yield list, after that name received the same chart check.

Not every name removed for the collapse pattern later deteriorated. At least one skipped highest-yield name later advanced in the same year while its substitute declined.

The collapse filter was framed as a defensive abstention overlay meant to limit large losses in a few names, not as a fitted function built to maximize historical profit. Rank rotation keeps that abstention inside the same holding-period procedure as entry and replacement.