The H Group Blog

Investment and Financial Planning news from some of the best in the business.

Putting the 19,000 Dow into Perspective

Putting the 19,000 Dow into Perspective

Ron Kelemen - Tuesday, November 22, 2016

The Dow Jones Industrial Average finally closed above 19,000 for the first time. Why do we say “finally”? Because it took a long time, 483 trading days over nearly two years. The gain from 18,000 to 19,000 comes to a 5.9% return. Doing the math, this comes to an average gain of 0.01% each trading day with a lot of volatility thrown in for good measure. Other milestones, from, say 16,000 to 17,000 happened faster and represented a higher percentage gain.

And that brings up another point: a 1,000 point gain ain’t what it used to be. The gain from 10,000 to 11,000 in 1999 represented a 10% gain, and the gain from 5,000 to 6,000 in 1996 equals a 20% advance—both occurring over shorter time periods.

Finally, while the Dow is a shorthand way of describing how certain equities in general are doing, it doesn’t give you a true picture of the financial markets. This index consists of only 30 very large stocks, excluding many other large, international, medium, and small companies and bonds, While the Dow is a celebrity index grabbing today’s headlines, the Nasdaq index has done much better recently. So enjoy this new benchmark, but party responsibly.





Trackback Link
http://www.thehgroup.com/BlogRetrieve.aspx?BlogID=17607&PostID=1483453&A=Trackback
Trackbacks
Post has no trackbacks.

Recent Posts


Tags

IPO Fed Beige Book Personal consumption expenditures GDP In the News Government regulation Health Insurance Year In Review Housing Starts Chicago PMI Risk Management Financial Planning Jobless Claims Dow Jones Taxes Scotland Gold Investment Planning Weather, Gas Prices Wholesale Inventories ISM Nonfarm productivity Income Obamacare MBA Mortgage Index Empire State Manufacturing Spending Hourly Earnings Money Market Economy Construction Spending FHFA Tax Inversion Trade Balance University of Michigan Social Security Home Sales Trade Deficit Brexit Factory Orders Our Team Members Currencies Fed Note Case-Shiller PPI Retirement Planning Industrial Production The Stock Market The Eurozone Consumer Price Index Bitcoins Europe JOLT The Economy NASDAQ International Monetary Fund Goods Trade Balance Elections Employment Quarterly Updates Equity Weekly Review Economic Indicators Inflation Capacity Utilization Vehicle Sales Global Markets FOMC General Portfolio Management Debt Continuing Claims NFIB Payrolls Producer Price Index The National Debt Unit Labor Costs Bonds Import Prices Education Planning Durable Goods ADP Employment Consumer Sentiment The Budget Deficit Interest Rates Medicare Insurance Helpful Hints Fiduciary Rule Building Permits Philly Fed Weekly Hours Fiscal Cliff NAHB Fun Question of the Week Millennials Nonfarm payroll Consumer Confidence The Fed Financial Markets Retail Sales Estate Planning Conference Board Business Inventories Euro Politics Labor Costs Unemployment Rate Average Earnings

Archive