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What is the Advance Decline Ratio? The advance decline ratio is used to determine how the market performed on a given day. It does this by comparin...

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Finance: What is the Dow Jones Industrial Average? 2710 Views


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Description:

What is the Dow Jones Industrial Average? The Dow Jones Industrial Average is usually just called the Dow. It’s an average of 30 of the most well-known and influential stocks. Using these stocks, it determines how the market is performing overall.

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English Language

Transcript

00:00

finance a la shmoop- what is the Dow Jones Industrial Average? well it's just

00:08

an index. it's a basket of 30 industrial stocks hence the catchy industrial word [list of the 30 stocks involved in the Dow]

00:14

in there and it was started in 1896 by Charles Dow and Edward Jones sort of the

00:18

Coke and Pepsi of stock averages in the day .worth noting is the fact that while

00:22

the Dow average is quoted often in the press it's not something that real Wall

00:27

Street traders really rely on that much as a market place holder anymore. why?

00:31

well because the Dow comprises only 30 stocks. it isn't really a broad market [Dow Jones in the trash]

00:37

representation, and you know the way the S&P 500 is the 500 is bigger than 30. Big

00:43

Brother has way more stocks and is thus way more liquid than the relatively

00:48

blippi set of 30 stocks that the Dow offers. over time the Dow has changed as

00:53

companies were bought and/or died and or just withered and became no longer

00:57

relevant. i.e. newspaper industry. which means that this thing has gone through

01:02

more faces than Kanye West .yeah. [Kanye West faces pictured]

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