DOW stuff

Okay, January was a lousy month for the DOW: down 4.9%. It was also lousy for the S&P: down 5.2%. The Nasdaq? Down 7.0%. But the value of the DOW is proportional to the sum of the stock prices. Which of the 30 DOW stocks has the highest price? IBM at $122. The lowest price? AA at $12.73. So IBM has about ten times the weight in calculating the value of the DOW. Okay, so what about the S&P? Its value is proportional to the market caps. What if the DOW were calculated like the S&P? Which of the DOW30 has the largest mkt cap? XOM at $306B. The smallest mkt cap? AA at $12.4B So, if the DOW were calculated like the S&P (proportional to mkt caps), XOM would have about 25 times the weight!! And how did these guys perform, in January 2010? Click on the pretty picture to enlarge. Ain't it nice that AA has a small weight. P.S. AA stands for Alcoholics Anonymous Alcoa. ------------------------------------ To have your portfolio mimic the DOW, you'd buy one share of each of the 30 DOW stocks. Suppose you invested equal dollar amounts (rather than equal share amounts)? You'd invest $1 in each DOW stock. How would you have fared, in Jan, 2010? Just like the DOW or S&P: about -5%. ------------------------------------ Want to see the current weights, for DOW stocks? by MktCap and by Price and performance assuming $100K were invested with equal amounts in each stock ------------------------------------ Will February be better? 'course, they is variations from the average from bestest to worstest, eh? (Click on the chart.)