What is the Dow Jones industrial average (DJIA)?

The Dow Jones Industrial Average (DJIA) is a stock market index of 30 prominent companies listed on major stock exchanges in the United States. It is one of the oldest stock indexes in the United States, having been first calculated on May 26th, 1896. The "Dow 30" is a list of the thirty stocks that make up the Dow Jones Industrial Average.

What is a DJIA Index?

The DJIA, like its cousins the Dow Jones Transportation Average and the Dow Jones Utilities Average, was developed by Charles Dow, a co-founder of The Wall Street Journal, to provide market data to his readers. The only company that has been in the index since its creation in 1896 is General Electric.

How do you calculate the DJIA?

While the specific formula used to calculate the DJIA is proprietary, the underlying concept is to sum the prices of all 30 stocks and divide them by the divisor. As a widely recognized benchmark, the Dow Jones Industrial Average is a vital reference point for investors, traders, financial analysts and economists.