And those are the least of the Dow’s problems. More troubling is
that it ignores the overall size of companies and pays attention
to only their share prices. This causes all sorts of oddities.
ExxonMobil, for example, divides its value into nearly five
billion lower-cost shares, while Caterpillar has around 650
million more expensive ones. Therefore ExxonMobil, one of the
largest companies in history, pulls less weight on the Dow than a
company less than a fifth its size.
I knew the Dow was imprecise and rather arbitrary compared to something like the S&P 500, but the more I learn about the Dow the more nonsensical I realize it is.