Upcoming Events Economic Event.
News for Dow Jones
DJIA consists of 30 large-cap Blue chip companies. Basically, DJIA is no longer a true proxy for the industrial sectors, but only the fraction of companies that make up the Dow are classified industrials. Rests of the companies are assigned from remaining sector found in Global Industry Classification System.
About 30 components have little or nothing to do with traditional heavy industry. The industry is currently Scaled average. The value of DOW is not the actual average of prices of stocks or components. These stock components are divided by a Divisor. Changes in Divisor occurs whenever the some components of a stock has a stock split or stock dividend.
The purpose of this whole method is to generate the consistent value for the index. Given the high volatile and unpredictable markets that marketers have been experienced from recent years, ETFs also called Exchange Traded Funds should be considered a new investment vehicle.
These Exchange Traded Funds are ideal products they deals on real time basis, they have low tracking errors in relation to the index, the exposure of these products to the market can be found very easily by using put and call options.
Keep up with live price movements with our Dow Jones chart and in-depth market commentary on the Dow Jones today. The Dow Jones Industrial Average is a stock index that tracks the performance of 30 of the biggest companies in the US. The Dow Jones is a price-weighted index, which means that its value is based on the price of its constituent shares rather than alternative measures such as market capitalisation.
The main purpose of the Dow is to give key insights about the health of the US stock market and even the economy as a whole. Traders turn to the Dow as a benchmark against which the relative performances of individual stocks can be measured.
While originally devised to track the performance of US industrial output manufacturing , its constituent companies now hail from sectors including telecommunications, energy, tech, pharmaceutical and entertainment to better reflect the modern US economy. Changes are sometimes made to ensure that the Dow continues to display an accurate cross-section of the US equity market.
While this divisor was originally the number of stocks in the index, it is regularly adjusted to ensure that the value of the index is not adversely affected by stock splits, changes to the composition of the index, or other modifications. However, it has since expanded to include 30 companies listed on the NYSE and Nasdaq, which represent a diverse cross-section of the industries comprising the US economy. However, while the average annual return has been positive, there has been significant volatility between years.
Since the performance of the Dow Jones is meant to reflect the behavior of the US economy, many of the same factors which impact the economy also tend to drive the price of the Dow. For example, its price can move in response to changes in monetary policy and economic data releases. The Dow Jones Index provides a useful proxy for those interested in speculating on the direction of the US economy as a whole.
Here are some of the reasons why people choose to trade the Dow:.