The low down on the Dow, Apple's new home
07.03.2015 14:30
Apple, the tech powerhouse and creator of the IPhone and IPad, will join the prestigious Dow Jones industrial average as of March 19. It takes the place of AT&T, which had been part of the iconic index since 1916. Here, we answer some questions you might have about the Dow.
Q: What is the Dow Jones industrial average?
A: Also known as simply the Dow, the Dow Jones industrial average is a price-based measure of blue chip businesses.
Q: When was it introduced?
A: May 26, 1896
Q: Why is it so prestigious?
A: The industrial average, along with the Dow Jones transportation average and Dow Jones utility average, were the world's first market indicators. Together, they comprise the Dow Jones Composite Average, a gauge of America's most esteemed companies.
Q: How many companies are included In the industrial average?
A: 30. When one is added, another is taken out.
Q: How does a company join the Dow?
A: Usually, a business must have a stellar reputation, show consistent growth, and have a significant following among investors. The Dow also seeks to maintain a healthy mix of sectors.
Q: How often do new companies join the Dow?
A: Rarely. Usually it happens after a company is purchased, or there's a major shift in a business's main focus.
Q:: Who oversees the Dow?
A: There is an "averages'' committee.
Q: Which Industries comprise the Dow?
A: All, except transportation and utilities, which have their own indexes
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