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Yawning on the job: Can a nap be far away?FRITZ REISS/The Associated Press

Should we care that the Dow Jones industrial average is shifting its member roster again? The keepers of the index announced that Kraft Foods Inc. is on the way out of the blue-chip index as of Sept. 21, making way for UnitedHealth Group Inc.

It marks the first rotation in the 30-member index since the dark days of 2009, when Citigroup Inc. and General Motors Corp. – both severely wounded during the financial crisis and recession – were sent packing, in favour of Cisco Systems Inc. and Travelers Cos.

As relative performance goes, the moves were mixed. Incoming Travelers shares have risen nearly 71 per cent since then, after factoring in dividends, while outgoing Citigroup shares have risen less than 2 per cent. But if you think the Dow masters have the magic touch, think again: the S&P 500 has risen 67 per cent over this period, so in line with the total return on Travelers. And incoming Cisco has been a dud, rising just 0.9 per cent.

Now, you can rightfully argue that member decisions about the Dow have less to do with expectations for strong performance and more to do with creating a narrow index that reflects the U.S. blue-chip equities universe and the U.S. economy. That's why the addition of UnitedHealth makes sense: Healthcare is a huge part of the economy.

But despite the high profile of the Dow and the fact that its performance is a kind of short-hand for equities investing in general, the index isn't really that useful. Index investors tend to go with the broader S&P 500. The SPDR S&P 500 ETF Trust commands assets of $113-billion (U.S.) – about 10-times the assets of the comparable SPDR Dow Jones Industrial Average ETF Trust.

The Dow is far more useful as a snapshot of blue-chip heavyweights, which is to say that a company that is good enough for the Dow is probably good enough for your portfolio. But again, the record is mixed. GM shares fell to zero, while American International Group Inc. (which departed the index in 2008) and Bank of America Corp. have been decimated.

Indeed, for a blue-chip index that is supposed to represent American capitalism at its best, the turnover is remarkable: There have been nine exits over the past 10 years. In the case of Kraft – which is now spinning off its Kraft Foods Group Inc., reducing its U.S. revenues – its presence in the Dow lasted just three years.

The latest changes are interesting. But as an investor, should you care? Probably not.

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