Dow Jones Industrials Average
What is the Dow Jones Industrials Average?
The Dow Jones Industrial Average index, is a price-weighted average of 30 of the most significant stocks traded on the New York Stock Exchange and the NASDAQ. The ticker code for the Dow Jones is DJIA and was invented by Charles Dow in 1896.
Uses of the Dow Jones Industrials Average?
The Dow Jones Industrial Average gives investors the overall performance of the 30 most significant publicly listed companies in America.
Investors are able to use this index as a form of hedging their investment portfolio. This is done by taking a long or short futures contract over their stock.
Risks of the Dow Jones Industrials Average
Like any index around the world they are susceptible to risks and the ups and downs of business cycles. This can include a downturn, or a recession due to poor company results, or a fall in demand of products produced.