Sumit Roy
2 min read
It’s been a sluggish year for the Dow Jones Industrial Average compared to the broader market. As of early June, the SPDR Dow Jones Industrial Average ETF Trust (DIA) is up just over 1%, trailing the Vanguard S&P 500 ETF (VOO), which has gained nearly 3%.
The reason for the underperformance is, in large part, a single stock.
UnitedHealth Group Inc. (UNH) has shaved roughly three percentage points off the Dow’s year-to-date return. No other stock in the 30-member index has contributed more than 0.9 percentage points in either direction.
Shares of UnitedHealth have been pummeled in 2025, falling more than 40% year to date due to concerns around Medicare Advantage margins and regulatory pressures—issues we’ve covered in depth previously.
That sharp decline has been especially painful for the Dow, a price-weighted index. Unlike the market-cap-weighted S&P 500, the Dow gives more influence to companies with higher share prices. At the start of the year, UnitedHealth was trading around $500 per share, making it the second-largest holding in DIA with nearly an 8% weight.
Now, with the stock hovering closer to $300, its weight has declined but remains substantial at about 4.4%, making it the ETF’s eighth-largest position. The drop illustrates how the Dow’s price-weighting methodology can amplify the impact of high-priced stocks, for better or worse.
Still, the damage is surprisingly contained. Despite the collapse of one of its biggest components, DIA is lagging VOO by only about two percentage points. That speaks to the index’s sector diversification and the resilience of its blue-chip constituents.
For all its quirks—including a relatively small roster of 30 stocks and price-based weighting—the Dow remains an interesting gauge of large-cap U.S. companies.
This year’s performance is a reminder that even in a concentrated portfolio, diversification across industries and solid fundamentals can help soften the blow from an individual stock meltdown.
