Dow Jones Sectors

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Volume 8 – Dow Jones Sectors

Dow Jones & Company, Inc. calculates the Dow Jones Industry Group Indexes, based on about 700 U.S. companies classified into approximately 95 groups. The industry groups are combined hierarchically to form sectors, and split into sub-groups, for a total of 127 categories. They are calculated on both an unweighted and capitalization weighted basis. The sectors used in this volume are all capitalization weighted. All of the sectors shown are based (by Dow Jones) so that June 30, 1982 = 100. The capitalization weighted performance of the stocks in each sector (excluding dividends) since then is reflected in the value of the sector index. For example, when the Energy sector is at 400, it is up 300% since June 30, 1982, and when Consumer, Non-Cyclical is at 1,100, it is up 1000% since June 30, 1982.

Eight Sectors

Basic Materials Financial
Consumer, Cyclical Industrial
Consumer, Non-Cyclical Technology
Energy Utilities

Charts in Volume 8

Sectors and their Relative Strength
charts a, b, c, d, e, f, g & h

These eight charts are all two-panel, landscape charts. Both panels are drawn with a logarithmic price scale. The lower panel shows the ratio of the sector to the Dow Jones Equity Market Index (the capitalization weighted average of all the US groups). The DJ Equity Market Index, by its construction, behaves almost identically to the Standard & Poor's Composite. When the line in the lower panel is rising, that sector is outperforming the market as a whole.

Dow Jones Technology Sector & Technology vs. DJ Equity

This example shows the DJ Technology sector and its relative strength. While investors are currently enamored with this sector, they shunned it before.

This is a 4kb thumbnail!
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over sixty full SVGA screens to show the detail on one Topline chart.

The real charts look much better than these thumbnails.

Comparable Log Scaled charts of the Sectors
charts i & j

These two portrait charts each show four sectors on a comparable log scale. If one sector's line on a comparable log scaled chart is steeper than another, it really is out-performing that sector–it is not just a scaling effect.

charts k & l

These two portrait charts each show the relative strengths of four sectors (same sectors as i & j) on a comparable log scale. By showing the relative strength, the chart subtracts the effects caused by changes in the overall market, allowing you to isolate the relative performance of the sector. A rising line here means that sector is outperforming the market as a whole.

charts i & k

Consumer, Cyclical Consumer, Non-Cyclical
Financial Technology

charts j & l

Basic Materials Energy
Industrial Utilities

All of the charts in this volume start on 6/30/82 (the entire history of the Dow Jones Groups) and use daily data.

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Last modified: April 06, 2005