Dow 50,000: Milestone in a Volatile Market

Dow Jones Breaks 50,000

These days, one milestone seems to be chasing the next. The Dow Jones Index just reached 50,000 points for the first time ever! We’re currently sitting well above that round number at 50,095 — pretty crazy, especially after such a volatile week.

The Dow Jones Industrial Average (“the Dow”) was created back in 1896 by Charles Dow and Edward Jones. It’s one of the oldest stock indexes in the U.S., tracking 30 major blue-chip companies, and it has a somewhat strange composition.

The Dow has nothing to do with market capitalization. Instead, it’s price-weighted, meaning companies with higher share prices have a much bigger influence on the index than those with lower prices. Right now, the biggest positions are Goldman Sachs (~12%), Caterpillar (~8%) and Microsoft (~5%).

Even though the Dow Jones is one of the oldest U.S. stock market indices, I personally prefer to follow the S&P 500. It’s much more diversified (500 stocks instead of 30) and market-cap weighted, which makes it more representative and, in my view, more meaningful.

Do you guys own any Dow Jones ETFs? I don’t tbh.