No. of Recommendations: 16
S&P Dow Jones Indices, which oversees both the Dow industrials and S&P 500 index, said that Verizon is leaving in part because its low stock price–around $46—gave the company an “immaterial impact” on the price-weighted index.
Verizon’s weighting was around 0.5%, while Goldman Sachs, whose stock trades for nearly $1,100 a share, has the highest weighting in the index at around 13%.
The price-weighted nature of the DJIA is asinine. They really should put the index out to pasture.
