Components of DJIA change as Kraft is out and UnitedHealth in
By Dian Vujovich
Change happens all the time particularly within the investment arena. For instance, beginning tomorrow, Monday, September 23rd, Wall Street begins the day with a change in the components of Dow Jones Industrial Average .
As hard as it might be to believe Kraft (KFT), the company that brings us literally hundreds of brand named products like Oreo, Cool Whip, Oscar Meyer, Gevalia and Jell-O, etc., etc., will no longer be one of the 30 stocks included in the DJIA. UnitedHealth Group (UNH) has replaced it.
The change symbolizes our changing times. You know, moving away from a company that provides American’s with a variety of foods that may or may not be great for their health to a company that’s in the business of caring for our health.
It’s also a change that doesn’t necessarily mean much with respect to how the stocks within the DJIA will perform going forward. According to The Exchange, a Yahoo Finance blog, Pfizer (PFE) and Verizon (VZ) became components of the Dow in April 2004. Since then, Pfizer’s per share price has fallen while Verizon’s has more than doubled.
Around since 1896, the DJIA was considered the only way to get a reading on the general health of corporate America and the stock market. Today, many think that index has lost its luster and believe the S&P500 to be a better gauge of industry in our changing economy.
I still happen to like following the DJIA. Why? Simply because there aren’t hundreds of stocks in it. And, I like dogs.
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