The Dow Jones Stock List
The Dow Jones stock list includes 30 or the largest, publicly-traded companies in the United States. The editors of the Wall Street Journal decide which companies should be included as each company on the list is considered to be a leader in its industry. All of the companies on the list are large-cap stocks that trade on the New York Stock Exchange (NYSE) or the NASDAQ. As a group, these stocks tend to rise and fall in unison with the stock market as a whole.
The Significance Dow Jones Industrial Average (DJIA) Index
The DJIA is a weighted index comprised of the 30 companies included in “The Dow”. The DJIA, which dates back to 1897 (originally it included only 12 companies), is one of the oldest stock market barometers used by analysts today to determine the direction of the market. While the DJIA represents only a small fraction of all of the stocks that are publicly-traded, it has become one of the most widely quoted and followed financial barometers and synonymous with the overall mood of the market. When a news source indicates whether the market went up or down on any given trading day, chances are they are referring to the performance of the DJIA.
How the DJIA is Calculated
The DJIA, weighted index, is computed by dividing the average price of the 30 stocks that comprise the index by a number known as the “divisor”. The divisor is used to factor in such activities as stock splits and company mergers in order to arrive at an accurate measure. The divisor, which does change quite often, is determined by the weight applied to all of the stocks. The application of the divisor means that an increase or decrease of a single point on any of the listed stocks will have the same impact on the index.
The Dow Jones stock list currently includes:
3m Co.
Alcoa Inc.
American Express Company
AT&T Inc.
Bank of America Corporation
Boeing Co.
Caterpillar Inc.
Chevron Corp.
Cisco Systems
E.I. du Pont de Nemours and Company
Exxon Mobil Corp.
General Electric Company
Hewlett-Packard Co.
Intel Corporation
International Business Machines
Johnson & Johnson
JP Morgan & Chase & Co.
Kraft Foods Inc.
McDonald’s Corporation
Merck & Co., Inc.
Microsoft Corporation
Pfizer Inc.
The Coca-Cola Company
The Home Depot, Inc.
The Procter & Gamble Company
The Travelers Companies
United Technologies Corporation
Verizon Communications
Wal-Mart Stores, Inc.
Walt Disney Company
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The above information is educational and should not be interpreted as financial advice. For advice that is specific to your circumstances, you should consult a financial or tax advisor.
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