Who Wins? And What a Decade of Hindsight Can Teach Us
Every evening, news anchors cite the Dow Jones Industrial Average as though reading the pulse of the nation. Financial professionals watch its daily moves and longer-term trends as a barometer of corporate health and economic sentiment. But what exactly is the Dow, does it still matter in a world of algorithm-driven trading and AI-powered markets, and can we really spot useful performance patterns from one year to the next?
A decade ago, this article first posed those questions when the Dow stood at roughly 17,800. Today, it trades near 47,500, having briefly touched the historic 50,000 milestone just weeks ago. The underlying lesson, however, has not changed one bit.
A Brief History – Updated for the Modern Era
The Dow Jones Industrial Average is a stock market index used to gauge the direction and overall strength of the U.S. equity market. Created in 1896 by Wall Street Journal editor and Dow Jones & Company co-founder Charles Dow, it originally tracked just 12 companies, including such golden oldies as American Cotton Oil Company, U.S. Leather Company, and Distilling & Cattle Feeding Company. The index expanded to 20 stocks in 1920 and then to its current 30-stock format in 1929.
Unlike the S&P 500, the Dow is price-weighted rather than market-cap-weighted. That means a company with a higher share price has a greater influence on the index, regardless of its total market value.
This quirk is important: it explains why a move in Goldman Sachs or UnitedHealth often shifts the Dow more than a comparable move in Apple or Amazon.
Because of its age, the Dow provides a nearly 130-year continuous chart of America’s economic growth. Consider the milestones: the Dow first closed above 1,000 in November 1972; above 10,000 in March 1999; crossed 20,000 in January 2017; vaulted past 30,000 during the post-pandemic rebound in November 2020; and reached 40,000 in May 2024. Then, on February 6, 2026, the index closed above 50,000 for the first time, powered by a surge in industrial and financial stocks. It was the fastest 10,000-point ascent in the Dow’s history, taking less than two years.
That euphoria was short-lived. Within weeks, a U.S.-Iran military conflict sent oil prices surging above $90 a barrel, a surprise February jobs report showed payrolls falling by 92,000, and the Dow retreated sharply. As of the close on March 6, 2026, the index stood at 47,501 – a reminder that markets can give back gains just as quickly as they accumulate them.
New Faces on the Roster
The Dow’s 30-stock lineup is not static. In late 2024, the index committee made several notable changes that reflect the shifting landscape of the American economy. Nvidia replaced Intel, giving the Dow direct exposure to the artificial intelligence semiconductor boom.
Amazon replaced Walgreens Boots Alliance, swapping a struggling pharmacy chain for a dominant e-commerce and cloud computing giant. And Sherwin-Williams replaced the chemical company Dow Inc., tilting the index further toward consumer-facing industrials.
These changes matter. The Dow you read about today is not the same Dow your parents followed. It continually evolves to remain a relevant snapshot of leading American enterprise.
Let’s Play March Madness with the Dow – 2026 Edition
Ten years ago, we ran a playful experiment: rank the Dow’s 30 stocks by the prior year’s performance and see whether the winners kept winning or the losers bounced back. Some investors believe in riding momentum – buying whatever performed best last year. Others prefer a contrarian approach, snapping up beaten-down names in hopes of a rebound. So, who was right?
Let’s update the brackets with 2025’s final standings and see what the first weeks of 2026 have already revealed.
2025 Winners – The Dow’s Top Five
| # | Company | Ticker | 2025 Return |
| 1 | Caterpillar | CAT | +69% |
| 2 | Goldman Sachs | GS | +64% |
| 3 | Johnson & Johnson | JNJ | +44% |
| 4 | Nvidia | NVDA | +41% |
| 5 | IBM | IBM | +39% |
Caterpillar’s dominant year was fueled by booming demand for power generation in AI data centers alongside traditional infrastructure spending. Goldman Sachs rode a resurgence in M&A activity and a favorable interest-rate environment. Johnson & Johnson proved its value as a defensive stalwart, barely dipping even during the spring tariff sell-off. Nvidia, entering its first full calendar year in the Dow, benefited from relentless AI chip demand. And IBM’s reinvention around hybrid cloud and artificial intelligence continued to pay dividends, including major acquisitions of HashiCorp and Confluent.
2025 Losers – The Dow’s Bottom Five
| # | Company | Ticker | 2025 Return |
| 1 | UnitedHealth Group | UNH | -35% |
| 2 | Salesforce | CRM | -31% |
| 3 | Home Depot | HD | -14% |
| 4 | Nike | NKE | -12% |
| 5 | Procter & Gamble | PG | -10% |
On the losing side, UnitedHealth Group suffered a devastating year – battered by rising medical costs, an earnings shortfall, the tragic murder of its CEO, and a Department of Justice criminal investigation. Salesforce saw its growth narrative crack as AI threatened to disrupt the very SaaS business models it pioneered. Home Depot and Nike struggled under consumer spending pressure and tariff headwinds, while Procter & Gamble found it difficult to pass along higher costs to budget-conscious shoppers.
Early 2026: Did the Patterns Hold?
Through the first weeks of 2026, the picture is characteristically messy. The Dow surged to 50,000 in early February on optimism around corporate earnings and Fed rate cuts, but the onset of the U.S.-Iran conflict and a surprise spike in crude oil prices changed everything.
Caterpillar, the top Dow stock in 2025, suddenly found itself leading declines in early March as global growth fears spread. Goldman Sachs and JPMorgan, both strong in 2025, were among the hardest-hit names during the March sell-off.
Meanwhile, Boeing – a laggard for years – rallied over 4% in a single session on defense spending expectations. Energy names like Exxon Mobil and Chevron surged as oil prices spiked, while the broader market retreated.
In short: last year’s winners are not guaranteed to lead again, and last year’s losers can surprise in either direction. Sound familiar? It should. We reached the same conclusion a decade ago.
The Timeless Lesson
Here is what we know, and what ten years of additional evidence has only reinforced: every large, powerful company has good years and bad years. Trying to predict future performance based solely on past results is a game of chance, not a strategy for long-term wealth building.
Consider the reversals we have witnessed over the past decade. Caterpillar was one of the worst Dow performers in 2015, a star in early 2016, struggled again mid-decade, and then became the top Dow stock in 2025 – only to stumble again in early 2026. Goldman Sachs was among the biggest losers in Q1 2016, rose to prominence in the years that followed, and became the second-best performer in 2025. Nike was the Dow’s top stock in 2015 and now sits among the worst performers for a second consecutive year.
These whipsaws underscore why diversification matters. A portfolio concentrated in last year’s winners can be just as risky as one loaded with last year’s losers. What changes from year to year is unpredictable: consumer sentiment, interest rates, geopolitical crises, technological disruptions, even the composition of the index itself.
What This Means for Your Portfolio
The Dow’s journey from 17,800 to 50,000 and back to 47,500 over the past ten years illustrates how long‑term diversified investors experienced significant market growth despite periods of volatility – despite a global pandemic, historic inflation, rapid interest rate hikes, trade wars, and now a military conflict in the Middle East.
The investors who benefited most were not the ones chasing last year’s hot stocks or panic-selling during the downturns. They were the ones who stuck to a disciplined plan, maintained a diversified allocation across asset classes and sectors, and resisted the urge to time the market.
So, who will be the best Dow performer for the rest of 2026? It is anyone’s guess. Hence, the Madness. And the reason a well-constructed, diversified portfolio remains one of the most powerful tools available to long-term investors.
If you have questions about how current market conditions may affect your financial plan, or if recent volatility has you rethinking your strategy, we welcome the conversation. That’s what we’re here for.
Sources: wsj.com, washingtonpost.com, reuters.com, Investopedia.com, Caterpillar, Goldman Sachs, Nvidia, IBM, Johnson & Johnson, Unitedhealth, apnews.com, CBSnews.com
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