What are the Dow 30 Components?
The Dow Jones Industrial Average (DJIA) is a price-weighted average that indicates the value of large 30 significant stocks traded on the New York Stock Exchange (NYSE) and the Nasdaq.
What does Dow 30 stand for?
The Dow Jones Industrial Average (DJIA) is the 2nd oldest and well-known stock market index. Its owned by Dow Jones and Company, it measures the daily price movements of 30 large American companies on the Nasdaq and the New York Stock Exchange.
How is Dow 30 calculated?
The Dow 30 is a price-weighted index. It means stocks with higher share prices are given greater weight in the index. At the Dow’s beginning, Charles Dow calculated the average by adding the prices of the twelve Dow component stocks and dividing by twelve. Over the period of time, there have been additions and subtractions to the index, like mergers and stock splits that had to be accounted for in the index. When one of these actions take place, the divisor for the Dow gets adjusted so the index’s value does not become affected. That’s why the Dow 30 can stand at 17,000 while the sum total of the components’ stock prices is nowhere near that number.