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Strategies & Market Trends : Jim's Nasdaq100 Special as a basket.

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To: James F. Hopkins who wrote (1445)10/27/1999 8:41:00 AM
From: OX  Read Replies (1) of 2103
 
>price weighted

Hi Jim,
Thanks for the reply... yes, I know the DJIA is price weighted.
I guess what I was trying to say is that it's easier to move an $80 by $4 than to move a $40 stock by $4. (which is why I made my stmt about a Dow component's stock splitting)
I understand what you mean that a small capitalized stock can be 'pushed' around easier.

If I look at the current prices of the 4 going IN and OUT:

27 S
41.25 GT
59 UK
88 CHV

45.56 SBC
70.68 HD
71.43 INTC
92.37 MSFT

if MSFT cancels out CHV in price, and SBC/GT
we've got HD +10 over UK (not bad), but then there's
INTC that's nearly 3X Sears.

INTC is more likely to move 3pts than Sears ever would.

Anyway, thanks for your posts on this... Altho I think the DJIA is better represented, I have some nagging concern that MSFT and INTC are in so many indices and weighted so heavily (via mkt cap).
With so many playing/owning indices, I just can't see that this is healthy.

**Why don't they change the other Dow indices... I'd like to see some internet/tech stocks in the TRAN and UTIL indices. Seriously.
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