The Dow's Impact on Individual Stocks: Could Amazon Fall While Walgreens Rises?

Investors remain vigilant with regard to the strategies employed by the stewards of the Dow Jones Industrial Average (DJIA), as the index's adjustments are meticulously crafted to maintain market stability. Despite their efforts, infallibility remains elusive. One intriguing speculation that surfaces from time to time involves the reputed 'Dow jinx' - an anecdotal observation that suggests a stock's inclusion in the DJIA might precede underperformance relative to its peers. This phenomenon has market watchers contemplating potential scenarios for companies in the index, such as Amazon, in comparison to those outside of it, like Walgreens.

Understanding the Dow Jones Industrial Average

The DJIA is a renowned stock market index, tracking 30 prominent companies within the United States. It is often considered a reflection of the overall market and economic health. The constituents are selected by a committee and are meant to represent a wide spectrum of industries. Notably, the composition of the DJIA changes occasionally, aiming to reflect the evolving business landscape.

Amazon vs. Walgreens: A Hypothetical Outlook

Given the historical context of the 'Dow jinx', investors could hypothetically witness a situation where Amazon's stock, despite its significant market presence, might underperform as compared to Walgreens. It's an interesting projection, given Amazon’s colossal size and influence in the market. However, it would be remiss to overlook the prowess of AAPL, or Apple Inc., whose impressive credentials highlight its status as the world's largest technology company by revenue and the world's most valuable company as of 2021. With its diverse portfolio in consumer electronics, software, and services, Apple stands as a formidable force among the Big Five American information technology companies, underscoring the tech sector's heft within the broader market.

Dow, Amazon, Walgreens, AAPL