APPLE'S TANKING: Here's what a 1-point move in Apple does to the Dow

Apple is a member of the Dow Jones Industrial Average, the 30-stock market index that aims to be representative of the US economy.

At $US121.00 right now, Apple is down $US9.75 or 7.46% in after-hours trading. That’s taking 59.55 points off the Dow.

How’d we compute that?

The Dow is peculiar in that it’s a “price-weighted” index, meaning that stocks with the highest share prices have the most influence on the index’s movements.

According to WSJ, the current Dow divisor 0.149677, which means that a 1-point move in any Dow stock moves the Dow by 6.6810 points. So if you want to calculate how many points a Dow stock is adding to or subtracting from the Dow, use this formula:

(Dollar change in stock price) x 6.6810= (Point change in the Dow)

Apple’s down $US8.85. So:

-9.75 x 6.6810 = -65.13 points

It’s recent price makes Apple the fifth most influential stock in the Dow. Goldman Sachs, IBM, 3M, and Boeing all have higher share prices and thus have more influence on the Dow.

That’s pretty much all you need to know about that.

NOW WATCH: A lawyer in Florida has come up with an ingenious way for drivers to evade drunken-driving checkpoints

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at