Dale; I guess I'm not explaining what I see, I have that problem,
and have posted the antics of 4 different "types" of indexes,
The DOW, price weighted , S&P Cap weighted ,
Intenut index Dollar weighted; and the SOX equal share weighted,
and they all act differently and also have different divisors.
What I'm trying to say is the S&P is cap weighted..
you can start off with x amount of shares in each one according
to the weighting but if the index changes much, the weighting
changes with it, and while the total outstanding shares don't
change, the amount of shares of each of them you need to hold to
match the index does change. Some how I want to say that's
a result or function of the divisor used to get create the index
in the first place, but I'm not sure that explains it either.
-----------------
I don't have the S&P indexed..guess I could, but I do have the
DOW indexed both price wise like it is, and that tracks it
flawlessly, so I know I got the divisor correct..as a result
if you in the DOW and tracking it, you wind up with the exact
amount of shares of each stock no matter were it goes,
BUT It's a new ball game if you cap weight it.
----------------
Cap weighted index of DOW DEC 22,
Symbol Last Trade % allocation SHARES my $ value
^DJI 4:04PM 9044.46
DIA 4:15PM 90.34
GE 4:29PM 99.60 13.55% 12.3081045 1225.887209
MRK 4:05PM 147.38 7.31% 4.485566282 661.0603308
XON 4:00PM 74.94 7.58% 9.154554788 686.0194495
WMT 4:06PM 78.31 7.34% 8.483759736 664.3844343
KO 5:01PM 67.44 6.92% 9.28573304 626.2066219
IBM 4:39PM 182.25 7.00% 3.475331161 633.379104
MO 5:01PM 53.38 5.41% 9.170069203 489.4524437
T 4:00PM 73.31 5.35% 6.604824107 484.2161674
PG 4:23PM 90.00 4.97% 4.996938826 449.7244943
C 4:14PM 50.44 4.77% 8.557325434 431.6101016
JNJ 4:24PM 77.00 4.31% 5.064931186 389.9997013
HWP 4:03PM 66.06 2.85% 3.905943328 258.0363811
DIS 4:24PM 29.94 2.55% 7.715674719 230.9880119
DD 4:07PM 54.19 2.54% 4.240192977 229.765457
CHV 4:01PM 83.75 2.27% 2.457074943 205.7800265
MCD 4:01PM 76.88 2.17% 2.548012738 195.8784793
GM 4:01PM 73.88 2.01% 2.464882121 182.0931667
AXP 4:01PM 101.63 1.91% 1.702651507 173.0319594
BA 5:01PM 31.81 1.32% 3.762928843 119.7081738
MMM 4:02PM 70.75 1.18% 1.511539971 106.9414529
ALD 4:02PM 42.56 0.99% 2.109218489 89.77361196
UTX 4:03PM 104.44 0.98% 0.850508468 88.82497817
EK 4:04PM 73.44 0.99% 1.220041256 89.59677975
JPM 4:00PM 102.19 0.74% 0.658390165 67.27924495
CAT 4:23PM 42.31 0.63% 1.350903853 57.16011926
S 4:00PM 41.44 0.66% 1.442825402 59.78707759
AA 4:08PM 69.25 0.53% 0.691381458 47.87816596
IP 4:01PM 42.75 0.55% 1.157402666 49.47896397
GT 4:02PM 52.00 0.34% 0.587084014 30.52836874
UK 4:13PM 42.25 0.23% 0.500450266 21.14402375
9044.169013 2,195.54 100.00% 122.46 9045.6145
2191.6075 8962.494777 real val^
------------------------
Note the above, and the below is exactly the same sheet,
Except I will drop the price of GE by $10, note how
the % alocation changes, AND the amount of shares owned
and the amount of money I have in each issue.
The only stock that moved in price was GE..
And droping it may better show the nature of the cap index
and that's what it takes to track a cap weighted index.
-----------
Symbol Last Trade %allctn SHARES my $value
^DJI 4:04PM 9044.46
DIA 4:15PM 90.34
GE 4:29PM 89.60 12.36% 12.42105454 1112.926487
MRK 4:05PM 147.38 7.41% 4.526729798 667.126804
XON 4:00PM 74.94 7.69% 9.238565066 692.3149696
WMT 4:06PM 78.31 7.45% 8.561614206 670.4814125
KO 5:01PM 67.44 7.02% 9.370947125 631.9532468
IBM 4:39PM 182.25 7.10% 3.507223868 639.1915499
MO 5:01PM 53.38 5.49% 9.254221854 493.9440915
T 4:00PM 73.31 5.43% 6.665435805 488.6597625
PG 4:23PM 90.00 5.04% 5.042795148 453.8515634
C 4:14PM 50.44 4.84% 8.635855007 435.5709369
JNJ 4:24PM 77.00 4.37% 5.111411466 393.5786829
HWP 4:03PM 66.06 2.89% 3.941787713 260.4043508
DIS 4:24PM 29.94 2.59% 7.786480562 233.1077618
DD 4:07PM 54.19 2.58% 4.279104732 231.8739877
CHV 4:01PM 83.75 2.31% 2.479623232 207.6684457
MCD 4:01PM 76.88 2.20% 2.571395553 197.6760331
GM 4:01PM 73.88 2.04% 2.487502056 183.7642144
AXP 4:01PM 101.63 1.94% 1.718276541 174.6198535
BA 5:01PM 31.81 1.34% 3.7974608 120.8067217
MMM 4:02PM 70.75 1.20% 1.525411196 107.9228421
ALD 4:02PM 42.56 1.01% 2.128574541 90.59745388
UTX 4:03PM 104.44 1.00% 0.858313485 89.6401146
EK 4:04PM 73.44 1.00% 1.231237432 90.41899891
JPM 4:00PM 102.19 0.75% 0.664432134 67.89665871
CAT 4:23PM 42.31 0.64% 1.363300939 57.68467098
S 4:00PM 41.44 0.67% 1.456066042 60.3357366
AA 4:08PM 69.25 0.54% 0.697726185 48.31753828
IP 4:01PM 42.75 0.55% 1.168024015 49.93302663
GT 4:02PM 52.00 0.34% 0.592471615 30.808524
UK 4:13PM 42.25 0.24% 0.50504284 21.33805998
9002.975596 2,185.54 100.00% 123.59 9004.4145
2191.6075 9003.546513 real val^
--------------------------------
Other wise you do not track a market cap weighted index,
I don't want to paste in the whole spread sheet,
But I do know what I'm doing even if I don't explain
it well, Indexes are complex.
Well so is ships stability
and trim calculations, but I can also do them both.
Also I have the only program in the world that in a hand held
old Tandy PC-6 computer will give the exact specifications of all the data in 2 volumes of Petroleum Measurement Tables,
For all the APIs that are in ASTN 1250-80 from volume correction
factors to Density , and I wrote the formulas myself.
---------------
Did it in Lotus 123..then converted that to basic, what a trick,
two volumes with only about 30 lines of code, and I am not a
programmer, & never had one day of schooling about computers.
I also complied it to run on any regular PC.
-------------
After that I wrote the cargo program still in use on the
Tanker Florida Express, it beats the one they paid $10,000
for :-) All they have to do is gauge the tanks, stick in
the temperature , and the API..and it calculates both the
GROSS and NET cargo of all 22 tanks. Plug in the info
in 5 min. and your done, The cargo inspector who does it with
a calculator and the Tables is working for two hours, if he don't
make a mistake he has to track down <G>
Jim
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