“As the largest corporation in the world and a leader in technology, Apple is the clear choice for the Dow Jones Industrial Average, the most recognized stock market measure,” says David Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices, in the statement. “The DJIA is price weighted so extremely high stock prices tend to distort the index while very low stock prices have little impact. The timing of Apple’s addition to the DJIA hinged on two stock splits: Apple’s 7:1 last June and Visa’s 4:1 on March 19th this year. Apple’s split brought the stock price down closer to the median price in the DJIA.”

When Apple announced its seven-for-one split in April 2014, it was widely speculated that split could lead to Apple eventually joining the Dow and DIA. The $12.4 billion DIA yields just over 2% and pays a monthly dividend. [Apple’s Split Could Mean a Dow Invite]

SPDR Dow Jones Industrial Average ETF

 

Tom Lydon’s clients own shares of Apple.