Where do I find the Dow Stock Chart? And How Does It Work?
It is more than often that we come across the term Dow Jones Industrial Average or DJIA in news, but besides knowing that it is something related to the stock market exchange or economy, what really do you know about it? The biggest drop in DJIA was registered on October 29, 1929 ( still known as ‘Black Tuesday’ ) and was followed by a 12-year long economic depression. This is no coincidence but, in fact, DJIA has been used as a benchmark for the US economy for a long time now. So, in the process of understanding this stock market index, let us start with the basic question – What is Dow Jones Industrial Average or DJIA? And how does the Dow Stock Chart work?
What is DJIA and how is it calculated?
To begin with, DJIA is a stock market index. It is one of the oldest indices which is still in use and was coined in 1896 by Charles H. Dow and Edward Jones. Since we have started off with its history; in the beginning, DJIA had 12 components companies. It was calculated as the mean of share prices of the stocks of these 12 companies. Therefore it was nothing more than just a weighted arithmetic mean.
Just like everything around us, DJIA (popularly called as ‘The Dow) has evolved to become more intelligent and accurate. The current DJIA has 30 components consisting of major economy leaders from each sector (except transportation and utilities). Unlike its beginning when DJIA was a arithmetic mean, it now a price-weighted stock market index. This means the component having a higher share price is given more weightage in the calculation of the index. The resultant is not divided by the number of stocks, as it was done earlier, but is divided by a DOW Divisor. The DOW Divisor os continuously adjusted depending on the changed market conditions; thus giving us an accurate figure of the stock market.
The main motive behind DJIA was to develop a reliable and a numerical benchmark to depict the trends in the stock market. DJIA thus became a great help for investors and currently is the most popular market index used by investors, any other economy-driven personnel, or media. The 30 components of The DOW are large publicly owned US-based companies which keep changing and currently include leaders like – Microsoft, Apple, IBM, Walmart, AT&T, etc. The DOW was invented for displaying the industrial sector of the US, but it is now used even as a substitute to measure general market conditions.
Securities Research is an investment research company with more than 80 years of experience in the field. Established in 1933, Securities Research has been helping investors to make the right investments. You, too, can learn about Dow Jones Industrial Average (DJIA) and use the extensive database of Securities Research.
DOW Stock Charts and Where to find them
The DOW has definitely got your attention and now you are wondering where to find it. So, the simplest way of finding Dow Stock Chart is directly through your search engine. Your search engine will provide you with an updated Dow Stock Chart. The main concern is – how to read these charts and what to make out of it?
The primary motive of DJIA is to measure the trend in the US Stock Market, but there has been underlying criticism about DJIA that it only accounts for just 30 Companies. So, one of the recommended steps in comprehending the DOW Stock Charts is to take other popular indexes into consideration. Besides this, developing an understanding of an index quote is very important with an extended knowledge of its key values such as the opening and closing value. Also, as DJIA is a collective price-weighted index of its 30 components, check for the individual contributions of the companies to the resultant value.
Reading DJIA Stock Charts is pretty complicated which requires practice and experience in the field. From a deep understanding of The DOW, reading an index quote, and other terms like high and low price, opening and closing value, etc. Securities Research has the most extensive and comprehensive collection of stock market data sets which can help you to develop a proper understanding of DOW Stock Charts. Download your free DJIA Stock Charts EBooks now!