What Is The Dow Jones Industrial Average (DJIA) And How Can I Invest In It?

The fluctuations of various stock indices are generally one of the first things you learn about, whether you’re an experienced investor or simply a casual stock market observer. The Dow Jones Industrial Average is one of those that receives the greatest media attention. Some investors follow it with as much excitement as a sporting event.

What Is The Dow Jones Industrial Average (DJIA) And How Can I Invest In It?

You might have the following queries: Describe Dow Jones. The Dow Jones Industrial Average is what? How does it function? Lastly, are there any additional indexes, and if so, how can I participate? All of these queries and more will be addressed.

What Is Dow Jones?

Since its inception in 1882, Dow Jones has focused on providing news coverage of business and the stock market. In order to cover the expanding range of diverse financial markets concentrated in and around New York City, Dow Jones was established and first operated out of a basement on Wall Street.

Today, News Corp. owns Dow Jones. Through a number of companies, including The Wall Street Journal, Barron’s, and MarketWatch, it offers news as well as market insights and statistics.

Dow Jones’ watchlist of 2.4 million high-risk individuals has leaked

A corporation with access to the database placed a watchlist of risky people and corporate organisations that are owned by Dow Jones on a server without a password, which allowed someone else to view the information.

Independent security researcher Bob Diachenko discovered the Elasticsearch database hosted by Amazon Web Services exposed more than 2.4 million records of people or companies.

What Is The Dow Jones Industrial Average (DJIA) And How Can I Invest In It?

The information, which has been safeguarded, is that of the banking behemoth’s Watchlist, which businesses utilise as part of their risk and compliance programmes. Other financial institutions, such as Thomson Reuters, maintain their own databases on politically exposed individuals, terrorists, and high-risk clients; but, over time, these databases have also been compromised due to other security lapses.

The Stocks of the Dow Jones Industrial Average

The following 30 stocks made up the Dow Jones Industrial Average index as of April 2019:

Company Symbol   Industry
3M MMM Conglomerate
American Express AXP Consumer Finance
Apple AAPL Consumer Electronics
Boeing BA Aerospace and Defense
Caterpillar CAT Construction and Mining Equipment
Chevron CVX Oil and Gas
Cisco Systems CSCO Computer Networking
Coca-Cola KO Beverages
Dow Inc. DOW Chemical Industry
ExxonMobil XOM Oil and Gas
Goldman Sachs GS Banking and Financial Services
The Home Depot HD Home Improvement Retailer
IBM IBM Computers and Technology
Intel INTC Semiconductors
Johnson & Johnson JNJ Pharmaceuticals
JPMorgan Chase JPM Banking
McDonald’s MCD Fast Food
Merck MRK Pharmaceuticals
Microsoft MSFT Consumer Electronics
Nike NKE Apparel
Pfizer PFE Pharmaceuticals
Procter & Gamble PG Consumer Goods
Travelers TRV Insurance
UnitedHealth Group UNH Managed Healthcare
United Technologies UTX Conglomerate
Verizon VZ Telecommunication
Visa V Consumer Banking
Walmart WMT Retail
Walgreens Boots Alliance WBA Retail
Walt Disney DIS Broadcasting and Entertainment

THIRTY YEARS ON THE DOW. 

The Dow Jones Industrial Average (DJI), also referred to as the “Dow,” is an index of the stock market that gauges the stock performance of 30 large businesses listed on the Nasdaq and the New York Stock Exchange. The Dow is typically mentioned when someone says, “The stock market is up today.”

Caterpillar celebrated 30 years as a Dow component in May of this year.

How the Dow Is Calculated

The Dow Jones Industrial Average is price-averaged, which means that it is calculated by dividing the average price of the index’s 30 constituent companies by a factor known as the divisor. The Dow is also a scaled average because the divisor is used to account for stock splits and mergers.

What Is The Dow Jones Industrial Average (DJIA) And How Can I Invest In It?

The Dow would fall if a stock split occurred if it weren’t determined as a scaled average. Consider splitting or dividing an index stock worth $100 into two equities of $50 each to serve as an example. The DJI would be $50 lower than it was before the administrators took into consideration that there are now twice as many shares in that company.

Business challenges

In the past, Dow Jones has been a source of essential information for its clients, providing it through tenacious journalism and top-notch research.

For those making decisions in business, finance, and other areas of life since 1882, Dow Jones is the reliable source of information. The Wall Street Journal, Barron’s, and MarketWatch are all published by the News Corp division, which will bring in $1.6 billion in revenue in fiscal year 2020. In addition, it provides an expanding range of B2B goods and services, including Factiva, Risk & Compliance, and Dow Jones Newswires, that are based on high-quality data.

The B2B business of Dow Jones shifted to a marketing strategy that was substantially more data-driven three years ago. Additionally, it increased the size of its marketing staff and took a fresh approach that emphasised revenue creation, customer experience (CX), sales enablement, and influencing the course of the company.

Bottom Line:

The DJIA is arguably the most widely reported stock market indicator, Dow Jones although it only provides a snapshot of market activity at any given moment. Additionally, it consists of 30 big businesses. If you’re looking for better indicators of the direction of investor mood and the economy, the S&P 500 and Nasdaq may be of assistance.

ETFs that track the performance of the indices are one way to invest. Before investing, be sure you understand what you’re getting into. For more information on index funds, see this article.

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