From Ticker Sense
One of our readers asked yesterday about what the Dow Jones Industrial Average would look like if it was not price weighted. Below we have recreated the index using a shares outstanding v. price weighting system similar to the S&P 500. (The "Price Weighted" line represents the actual index.) In order to calculate the new index, its initial price was set equal to the value of the DJIA on 5/3/06, below represents one year. We noted that the weight of each individual stock can be quite different, but the overall performance of the index is relatively unchanged.
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