Re:I'm reading the FT and WSJ from 100 years ago each week l...
by antihipocrat on Sunday August 08, 2021 @07:12PM
(#28111068)
It also includes some survivorship bias. The Dow only includes companies with a market cap above a threshold.
In order to get a better estimate of returns it would have to include the cost of redistribution of investments due to the changes in companies that constitute the Dow. Some of these companies that dropped out of the Dow would also have been trading near insolvency, and the losses associated with investments in them need to be accounted for.
In order to get a better estimate of returns it would have to include the cost of redistribution of investments due to the changes in companies that constitute the Dow. Some of these companies that dropped out of the Dow would also have been trading near insolvency, and the losses associated with investments in them need to be accounted for.