The Weekly Wealth of Knowledge is your download of this week's most important topics related to financial planning, the markets, and our community. September is back to school month at Moneco Advisors, where we discuss everything from financing school supplies to saving for college.
In this issue:
- Changes to the DOW 30 Lineup (4 min read)
- Back to School: Financial Aid (3 min read)
- Yankee Magazine's first fall foliage forecast (3 min read)
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This week we have an introduction from Financial Advisor Scott Flynn!
Changes to the DOW 30 Lineup
The Dow Jones Industrial Average (DJIA), one of the most widely followed stock market indices, has made some key changes to its starting lineup. Salesforce.com, Amgen Inc.and Honeywell International Inc. have replaced Exxon Mobil Corp., Pfizer Inc., and Raytheon Technologies Corp.
The change went into effect before the market opened on Monday, August 31. 1
It’s important for investors to know that the changes took effect so they have a better understanding of the financial markets. But it’s also important to note that the DJIA has made several adjustments since it was first published in 1896, so a change to the Dow 30 lineup is nothing new. 2
The index changes were prompted by Dow component Apple Inc’s decision to split its stock four-for-one, which also took effect on August 31.3
The DJIA is a price-weighted index, meaning the 30 companies are weighted in proportion to their price per share. By splitting its shares, Apple effectively reduced its influence—and the entire technology sector’s influence— on the Average. In fact, Apple’s move reduced the technology weighting within the Dow from nearly 28% to 20%. The addition of Salesforce is designed to help bolster the technology sector. 3
Put another way, before the split, Apple was the most influential component in the DJIA, but after the split, it drops to 17th. 3
Some market analysts have said the changes make the index “more in tune with the new economy.” The DJIA changes reflect the growing influence of technology and the waning influence of the old economy. Oil and gas multinational Exxon, for example, joined the Dow more than 90 years ago in 1928. 4,5
Please remember that the companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
Back to School: Financial Aid
Preparing for college is difficult, especially for high school students who already have so much on their plate. For many students, the thought of going to college seems far away, and applying for financial aid feels like another task on the endless to-do list. Luckily, with these tips and a little preparation, applying for financial aid can be easy and stress-free. Click here to learn more!
Yankee Magazine's First Fall Foliage Forecast
There's nothing like the fall scenery in New England that makes us want to visit new parks, trails, and nature reserves. On top of that, the outdoors is one of the safest places to be right now, so why not appreciate it?
Yankee Magazine just published its first fall foliage forecast, which reports that this fall we will see potential for "a big color punch." The forecast gives an in-depth description of what this season's foliage is going to look like, and why. Click here to read more.
1. S&P Dow Jones Indices, August 24, 2020
2. Investopedia, August 2018
3. CNBC.com, August 24, 2020
4. CNBC.com, August 25, 2020
5. Reuters.com, August 24, 2020
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite, LLC, is not affiliated with the named representative, broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly.