Two questions LBOers:
1) Companies occasionally are changed in the Dow Jones industrial
average as a result of mergers or other factors. Examples, in 1997,
Westinghouse, Texaco, Bethlehem Steel and Woolworth, all were dropped.
Although adjustments are made to the weighting, has anybody ever
closely examined how the Dow index would have fared if obviously
lagging companies hadn't been removed?
2) Any suggestions on the best indices to track market performance AND
economic performance? In other words, there's a disconnect between
market-related indices and how well Joe Sixpack is doing.
Thanks.