The Dow Jones Industrial Average Is a Joke of an Index, and Here's the Data to Prove It

The Dow Jones Industrial Average Is a Joke of an Index, and Here's the Data to Prove It

For 121 years, the Dow Jones Industrial Average (DJINDICES: ^DJI) has arguably been the world's most followed stock index. After all, it's the second-oldest stock market index behind the Dow Transportation Index, which shares the name of its creator, Charles Dow.

Composed of 30 multinational companies that often have market caps in excess of $100 billion, the Dow is designed to give investors some sense of how well or poorly the U.S. economy is performing. Meanwhile, occasional changes to the index, which see companies that no longer have as much influence swapped out for larger or more important companies to the U.S. economy, are intended to keep it fresh and relevant.

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Source: Fool.com