On: Nvidia to join Dow Jones Industrial Average, repla...

[dkrich]

This may make sense in theory but in reality is wrong. The DJIA has historically had a very close correlation to the S&P. Plus there is an inescapable psychological aspect to the Dow that is unique. When the Dow is off 1500 points it hits much differently than the S&P falling 200 points.

[ywvcbk → dkrich]

> inescapable psychological aspect to the Dow that is unique.

Sounds about the same as:

> that is reported on because people talk about it because it's reported on.

The unique aspect is that a randomly weighted index is just outright stupid however you look at it.

[dubcanada → dkrich]

I have a feeling that is because every company in the DJIA is also in S&P, and most are very heavily weighted in S&P. Rather then companies within the DJIA doing as good as companies in the S&P.