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

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

Archive