click for interactive version

Source: WSJ



Nice graphic and article explaining how only 5 stocks (of 30) in the Dow are the prime drivers of the rally, responsible for one third of the gains.

Before you go Oooh, consider the simple math of this. If every stock contributed equally to the Dow’s rise, than 10 stocks would be worth a third of gains.  But as in typical collections of different items, there is a bell curve, a normal distribution.

Thus, it should come as no surprise that some stocks have contributed much more than others.

Point Contributions:

IBM     941.77
Catepillar 507.56
3M  493.81
Chevron  456.63
United Technologies  413.32

The full distribution of winners is losers are at the article.



Five Stocks Handled the Heavy Lifting
Steve Russolillo
WSJ March 5, 2013

Category: Index/ETFs, Markets

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

4 Responses to “Drivers of the Dow”

  1. techy says:

    DOW all time high does it mean anything significant, other than for CNBC?

    Does 30 stocks represent the market fairly? what is the meaning of these indexes if they do not take dividend into account? You can have a stock like AT&T which pays >5% dividend, of course it will have a tough time going higher.

    What about inflation?

  2. cuprous says:

    Funny, I don’t see “Federal Reserve, Inc.” @ $120 million/hour in that list.

  3. bill750 says:

    @techy Thirty stocks absolutely do not represent the market fairly, not that the talking heads on CNBC care. I’d rather look at the equal-weighted S&P 500, which has handily outpaced both the Dow and the cap-weighted S&P 500 during the same period measured in the illustration. (RSP,DIA,SPY) While some are poo-pooing the current rally by talking about the narrower focused Dow and the cap-weighted S&P 500, it is interesting to note that RSP has also been making new highs. For that matter, RSP has substantially outperformed the other two since early 1999, both on the upside and during the occasional meltdown. Does the RSP represent the market more fairly? Perhaps, perhaps not, but it certainly has outperformed. This is not counting dividends, of course, but I prefer the one stock, one vote concept.

  4. mst says:

    To be honest, I hung my head low when being briefed on the this “great rally” from wall street. I did not even need to look at for the main “incubators” of this facade. I knew. And my head hung lower as I over heard the common investor’s cry out that “the economy” is recovered. Perceptions…and ignorance…drive us back into a lull, a deep sleep.

    A man stopped me today on my lunch walk. I have seen him before many times. He is a man without any means. He asked me: “where is my lunch?”

    I had empty pockets. But I listened to his words.