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If you weren't just interested in derailing the conversation, you would have looked up how this stacks up with a better index. I did, so you might be cheered to
by MagnumOpus 5y ago
If you weren't just interested in derailing the conversation, you would have looked up how this stacks up with a better index. I did, so you might be cheered to know that the S&P 500, a cutting edge market-weight based broad index, dropped 20.2% from 1990-07-03 to 1990-10-11 compared to the DJIA's 18%.
- astrange 5y agoYes, but there's never any good reason to bring up DJIA unless you're a TV reporter who needs a big number, so I think it's always a good deed to complain about it.
- ianai 5y agoImportantly, no one serious should use the djia as a proxy for a larger sample like the economy. The stock market already isn’t the entire economy and the djia is selected to not be representative of the stock market.
- llampx 5y agoThe DJIA selects a certain type of stock. Think more PG than TSLA.
- bluGill 5y agoDJIA was an important index in the before computer days (I guess up until the 1970s) when indexes were calculated by hand. Any reporter could calculate the DJIA in a few minutes and thus provide investors up to date information over the course of a day. Larger index like the S&P500 took long enough to calculate that by the time you did it the calculation was obsolete for news purposes - unless the market was closed. Thus DJIA would be reported hourly, while S&P500 was only calculated overnight. Today we can update any index you might be interested in, in a few milliseconds. (I'm sure there are high frequency traders reading this who can give more accurate timings)