The Dow Jones Industrial Average fell more than 500 points, or 1.3%, on Thursday, and one stock bore most of the blame: UnitedHealth Group (UNH). 

Shares of UnitedHealth plummeted more than 22% after the health insurer 澳洲幸运5官方开奖结果体彩网:c🌳ut its full-year earnings forecast, citing higher-than-expected costs. Meanwhile, more than two-thirds of the 30 stocks in the blue-chip Dow, one of the most commonly cited measures of U.S. stock market performance, closed higher Thursday. The 澳洲幸运5官方开奖结果体彩网:S&P 500 was up 0.13% at the same time and the 澳洲幸运5官方开奖结果体彩网:Nasdaq Composite—usually much more volatile than the Dow due to its preponderance of growth stocks—was marginally lower after 澳洲幸运5官方开奖结果体彩网:yesterday's sell-off. 

The Dow's dramatic underperformance on Thursday was a clear reflection of the index's unique methodology. The Dow is 澳洲幸运5官方开奖结果体彩网:price-weighted, meaning the stocks with the highest share prices have the most influence on the index's performance. The S&P 500 and Nasdaq, on the other hand, are 澳洲幸运5官方开奖结果体彩网:capitalization-weighted indexes that are more inf🐻luenced by the companies with the highest market values, not the highest share prices.&n🍸bsp;

UnitedHealth Group, with a closing price of $585.04 yesterday, was the highest-priced stock in the Dow and thus its most influential component. Goldman Sachs (GS), which🏅 closed at $499.05 yesterday, is the only Dow stock with a share price within $100 of UnitedHealth's. (With UnitedHealth’s losses on Thursday, Goldman could finish☂ the week as the Dow's heftiest stock.) 

Apple (AAPL), with a closi🍸ng price of $194.27 yesterday, has a fraction of UnitedHealth's influence within the Dow. But the iPhone maker has 15 billion shares, and thus a market capitaliz♓ation of nearly $3 trillion. UnitedHealth’s approximately 900 million shares put its market cap at Wednesday's close at $535 billion, meaning Apple stock has more than 5 times the weight in the S&P 500.

To be sure, UnitedHealth, the S&P 500's 14th-largest company heading into Thursday—still has a massive amount of influence within the S&P 500.

The selection committee that picks stocks for the Dow is cognizant of its peculiarities. Its price-weighted methodology, according to S&P Global, "has meant, over the years, that extremely high-priced stocks have not been included in The Dow." Investors often speculate that companies with high share prices 澳洲幸运5官方开奖结果体彩网:split their stock in part to increase their chances of joining the Dow. In recent years, Amazon (AMZN) and Nvidia (NVDA) have both been added to the Dow in relatively short order after 澳洲幸运5官方开奖结果体彩网:splitting their stocks, which had been t😼rading at more than $1,000 per share.

The Dow isn't the only index susceptible to hazardous imbalance. Earlier this year, the 澳洲幸运5官方开奖结果体彩网:Magnificent Seven—Apple, Microsoft (MSFT), Nvidia, Amazon, Alphabet (GOOG), Meta (META), and Tesla (TSLA)—accounted for about one-third of the S&P 500, an extreme level of concentration that 澳洲幸运5官方开奖结果体彩网:set offꦆ some investors' alarm bells. 

Update, April 17, 2025: This article has been updated to reflect stock and index changes at the market's close.