UK Accounting Glossary
The Dow Jones Averages refer to three price-weighted stock market indexes maintained by the editors of the Wall Street Journal. The first of the Dow Jones Averages to be created was the Dow Jones Transportation Average. It was formulated by Charles Dow in 1884. The Dow Jones Transportation Average, which was originally comprised primarily of railroad companies, today consists of 20 of prominent stocks in the transportation industry. The second of the Dow Jones Averages was the Dow Jones Industrial Average. It consists of 30 stocks from multiple industries. It is the most widely known of the Dow Jones Averages. The third of the Dow Jones Averages is the Dow Jones Utility Average. It is comprised of 15 utility stocks and was created in January 1929. The Dow Jones Composite Index, first published in 1933, is a composite of the 65 stocks included in the three Dow Jones Averages. Although the component stocks of the Dow Jones Averages rarely change, the composition of the Dow Jones Averages is reviewed by the editors of the Wall Street Journal periodically to determine whether any changes in the stock composition is required (e.g. due to mergers, acquisitions, etc.).
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This glossary post was last updated: 9th February 2020.