06/23/99

The Dow:

The Dow Jones Industrial Average is the most famous of the stock market indexes.  Dow Jones is the company that puts out The Wall Street Journal.  They are the ones who originally constructed the stock market index.  It is comprised of 30 "industrial" stocks.  The DJIA changes stocks very rarely.  It is used as a Barometer of the stock market

AT&T
Alcoa
Allied Signal
American Express
Boeing
Caterpiller
Chevron
Citigroup
CocaCola
Disney
DuPont
Eastman Kodak
Exxon
General Electric
General Motors
Goodyear
Hewlett Packard
IBM
International Paper
Johnson and Johnson
McDonalds
Merck
3M
Morgan JP
Phillip Morris
Procter and Gamble
Sears
Union Carbide
UtdTch
WalMart

These stocks are sometimes referred to as a "component of the Dow."  Notice that they are all big, important companies (Blue Chip is the buzzword).
Since it only covers 30 stocks, The DJIA is the narrowest of all indexes.

Other Major Indexes:

S & P 500 – broader indication
Changes stocks more often
Constructed mathematically
Each stock is weighted reflecting its market value
(Number of shares outstanding X market price = market value)

NYSE index – even broader
Reflexes all stocks traded on exchange (1500?)

NASDAQ Composite

Russell 2000

Wilshire 5000 - Contains all stocks traded on NYSE as well as all the stocks on the ASE.  It also includes the most active on the NASDAQ.  Represents the total dollar value of all 5,000 stocks.