2020 Dow Jones Industrial Average Return

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The Dow Jones Industrial Average returned 6.87% in 2020. Using a better calculation, which includes dividend reinvestment, the Dow Jones returned 9.70%.

2020 Dow Jones Industrial Average Return: Reinvest Your Dividends

I ran the above calculation for an index purchase at open on January 2nd, 2020 and sold at close on December 31, 2020. This would match the year-to-date return if you looked on the last of the year.

Alternatively, you might like a one-year holding proxy. If you bought the closing price on December 31, 2019 and sold the close on December 31, 2020 the returns would be 7.25%9.72% with dividends reinvested.

Dow Jones 2020 Index Returns

Price FromPriceDec 31 CloseGain/Loss
Jan 2 Open28638.9730606.486.87%
Dec 31 Close28538.4430606.487.25%

Dow Jones 2020 Total Return Index Returns

Price FromPriceDec 31 CloseGain/Loss
Jan 2 Open64517.4470778.109.70%
Dec 31 Close64505.4870778.109.72%

The takeaway message? The exact date doesn't really matter. However, dividends matter.

You can see the effects of reinvesting over a single year – ~ 2.83%. And even if you didn't reinvest, you'd still have to do something with your dividends (or use the checks to start a fire to heat your house, I guess!).

Investing in the Dow Jones Price-Weighted Stock Index

Most stock indices nowadays are market capitalization weighted, (e.g., the 2020 S&P 500 Return). The Dow Jones Industrial Average is a price-weighted index, by contrast.

Price-weighted indices derive their actual trading prices by the trading price of the underlying company shares times some individual stock factor.

Price weighting is not a great indexing method. However, I'm not here to doubt its usefulness – in 1896, it was easier to track price changes than up-to-the-minute market capitalization. Also, it has historically tracked other indices pretty well... so Dow Jones got a ton right.

Source on the 2020 Dow Jones Industrial Average Return Calculations

Data is sourced from the Dow Jones Indices, owned by S&P Dow Jones Indices. There you'll find both the price index and total return index.

Want even more? DQYDJ has you covered – both investing content, and some Dow Jones specific posts:

See DJIA returns in other years:

How do you see the Dow Jones Industrial Average performing in 2021?



PK started DQYDJ in 2009 to research and discuss finance and investing and help answer financial questions. He's expanded DQYDJ to build visualizations, calculators, and interactive tools.

PK lives in New Hampshire with his wife, kids, and dog.

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