Apple (AAPL) Addition Won't Offset Tech's Underrepresented Dow Weighing too Much

The addition of Apple (Nasdaq: AAPL) to the Dow Jones Industrial Average will help out the tech scene in the index, but the segment will still be lightly represented as a whole.

The WSJ noted Friday afternoon that just four tech companies -- Cisco Systems (Nasdaq: CSCO), IBM (NYSE: IBM), Intel (Nasdaq: INTC), and Microsoft (Nasdaq: MSFT) -- are also included in the DJIA, which aims to house a diverse mix of 30 stocks. In total, the five companies will account for 10 percent weighting in the index, versus 20 percent for the S&P 500.

Some argue that the percentage should be larger given the importance of the tech sector. According to an IHS report, knowledge and tech intensive industries were said to account for around 40 percent of U.S. GDP last year. Absent the health and education sectors, and the segment still amounts to about 30 percent of GDP.

Apple was largely added as Visa (NYSE: V) is planning a stock split. Because the DJIA is a price-weighted index, a company with a stock price of $50 will have a five-times greater impact than one with a $10 stock price.

Shares of Apple are up 0.4 percent, having trended lower with broader markets Friday.

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