Finance Dictionary
Dow Jones Industrial Average
Definition
A stock market index that measures the stock performance of 30 large companies listed on stock exchanges in the United States.
Deep Dive
The Dow Jones Industrial Average (DJIA), often simply called "the Dow," is one of the oldest, most recognized, and frequently cited stock market indices in the world. Established by Charles Dow in 1896, it serves as a barometer for the overall health and direction of the U.S. stock market and broader economy. The DJIA tracks the stock performance of 30 large, publicly traded companies in the United States, often referred to as "blue-chip" stocks, which are considered leaders in their respective industries and generally represent a significant portion of the American industrial and service economy.
Examples & Use Cases
- 1News reports frequently cite the Dow Jones Industrial Average's daily rise or fall as a headline indicator of the U.S. stock market's performance.
- 2An investment analyst might examine historical DJIA data to identify long-term economic cycles and trends in major American industries.
- 3A retirement fund manager might use a passive investment strategy that tracks the performance of the 30 companies within the Dow.
Related Terms
S&P 500Nasdaq CompositeBlue-Chip Stock