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Interesting trivia tidbit about the Dow Jones Industrial Average history...
Posted on 4/26/17 at 9:56 am
Posted on 4/26/17 at 9:56 am
Ten years ago yesterday, April 25, 2007, the DJIA went over 13,000 for the first time ever.
It closed yesterday a little under 21,000.
What does this mean?
Nothing....I'm just bored.
It closed yesterday a little under 21,000.
What does this mean?
Nothing....I'm just bored.
2
Posted on 4/26/17 at 10:05 am to LSURussian
Interesting, so that's a 6.1% return over that 10 year period (with a major recession in the mix).
I personally think we are slightly under valued still.
I personally think we are slightly under valued still.
Posted on 4/26/17 at 10:09 am to Shepherd88
quote:Move your decimal one place to the right...
Interesting, so that's a 6.1% return over that 10 year period
(Unless you mean annually.)
Posted on 4/26/17 at 10:14 am to LSURussian
Yes, I meant annualized.
Posted on 4/26/17 at 10:20 am to Shepherd88
The DJIA fell to 6,470 on March 6, 2009, which was its lowest point during the Great Recession.
So it fell from that 13,000 in 2007 down to about half two years later.
It didn't reach 13,000 again until February, 2012.
So it fell from that 13,000 in 2007 down to about half two years later.
It didn't reach 13,000 again until February, 2012.
Posted on 4/26/17 at 10:34 am to Shepherd88
quote:
Interesting, so that's a 6.1% return over that 10 year period (with a major recession in the mix)
Which doesn't include dividends. Just putting that out there for anyone thinking they are only getting a 6% return.
Posted on 4/26/17 at 10:39 am to LSURussian
Why the Dow Jones is still popular blows me away. It is such an outdated index that is really just an antiquity of the market.
Posted on 4/26/17 at 10:43 am to lynxcat
quote:
Why the Dow Jones is still popular blows me away. It is such an outdated index that is really just an antiquity of the market.
I'm an S&P man
Posted on 4/26/17 at 10:46 am to lynxcat
quote:
Why the Dow Jones is still popular blows me away. It is such an outdated index that is really just an antiquity of the market.
Why people think this is somehow a wonderfully enlightened point is even more baffling.
I mean, it still roughly tracks any other general stock market index you want to use and it carries historical cache that none others have. Seems pretty obvious to me, why some still reference it.
Posted on 4/26/17 at 10:54 am to lynxcat
quote:
Why the Dow Jones is still popular blows me away.
The media likes to report the big numbers to the masses. Without context, saying the Dow is up or down 45 points sounds much more impressive than saying the S&P is up or down 6 points. It sounds much more impressive stated that way even though it's about the same size move.
The media does those kinds of plays on numbers all the time to get views, ratings, clicks, etc. For example, saying 40,000 Americans die every year in car accidents (or saying that 110 Americans die every day in car accidents) sounds more impressive and concerning than with the context that the US has a population of around 320 million people and that car accidents are responsible for just 1.5% of all American deaths each year.
Posted on 4/26/17 at 11:08 am to Y.A. Tittle
quote:
Why people think this is somehow a wonderfully enlightened point is even more baffling. I mean, it still roughly tracks any other general stock market index you want to use and it carries historical cache that none others have. Seems pretty obvious to me, why some still reference it.
The Dow's a price weighted index with only 30 components. As a price weighted index, it takes into account dollar sized moves in its components, not the percentage moves. Basically, a $1 move in one of the components moves the Dow about 7 points or so. It doesn't matter if that $1 was a 1% move in a $100 stock, a 0.1% move in a $1,000 stock, or a 10% move in a $10 stock. Plus, it's not hard to argue that the Dow has too few components for a proper sample size of the market.
This leaves the S&P 500 as an understandably better index, though the Dow does have the redeeming factor of history.
Posted on 4/26/17 at 11:56 am to lynxcat
quote:
Why the Dow Jones is still popular blows me away. It is such an outdated index that is really just an antiquity of the market.
In the right context, I believe it's still useful.
If the Dow were to deviate too far from other benchmarks and metrics, it'd be concerning in my opinion.
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