The Dow Jones Industrial Average, also known as the Dow, is one of the most popular stock indexes, along with the S&P 500 and Nasdaq Composite. The Dow tracks the stock performance of 30 large, blue chip companies.
Here you’ll find the details about the Dow Jones Industrial Average, including which companies are included in the index and how it is calculated.
The following 30 companies are included in the Dow Jones Industrial Average as of February 26, 2024:
| 3M (MMM) | Amazon.com (AMZN) | American Express (AXP) |
| Amgen (AMGN) | Apple (AAPL) | Boeing (BA) |
| Caterpillar (CAT) | Chevron (CVX) | Cisco systems (CSCO) |
| Coca Cola (KO) | Dow (DOW) | Goldman Sachs (GS) |
| Thuisdepot (HD) | Honeywell International (HON) | Intel (INTC) |
| International Business Machines (IBM) | Johnson & Johnson (JNJ) | JPMorgan Chase (JPM) |
| McDonald’s (MCD) | Merck & Co. (MRK) | Microsoft (MSFT) |
| Nike (NKE) | Procter & Gamble (PG) | Salesforce (CRM) |
| Travelers (TRV) | UnitedHealth Group (UNH) | Verizon Communications (VZ) |
| Visa (V) | Walmart (WMT) | Walt Disney (DIS) |
How is a stock added to the Dow Jones Industrial Average?
To be included in the Dow Jones, a company must be part of the S&P 500 and cannot be part of the transportation or utilities sectors (S&P Dow Jones Indices has other indexes that track these parts of the economy).
The S&P 500 itself has different requirements regarding things like the company’s market capitalization, where the stock is traded, profitability and trading volume.
Finally, the Dow Jones Industrial Average is maintained by a committee that includes three representatives from S&P Dow Jones Indices and two representatives from The Wall Street Journal.
Because the Dow is limited to 30 companies, if one company enters the index, one company must leave the index. In February 2024, Amazon.com replaced Walgreens Boots Alliance in the index.
The Dow Jones Industrial Average is a price-weighted index
The Dow is a price-weighted index, meaning the stocks in the index are weighted by their share price. This can create some unique situations, such as a company with a smaller market capitalization than other companies in the index having a greater weight because its share price is higher. For this reason, stock splits have a particularly large impact on price-weighted indices.
Apple, for example, is one of the largest companies in the world and, as of February 2024, has the second largest weighting in the market cap-weighted S&P 500, based on a market cap of $2.83 trillion. But in the Dow Jones it has only the 15th largest weighting, based on its share price of about $183. UnitedHealth Group has the largest weighting in the Dow Jones due to its share price of $522, despite a market capitalization that is less than 25 percent of Apple’s.
The price level of the Dow is calculated by adding the stock prices of the companies in the index and dividing by the Dow divisor, a figure that is periodically adjusted for corporate actions such as dividend payouts and stock splits.
Dow Jones Industrial Average vs. S&P 500
The Dow and the S&P 500 are probably the two best-known stock indexes, but there are a few important differences between the two.
- Diversification: The Dow includes just 30 major companies, while the S&P 500 includes about 500, making the latter a much broader and more diversified measure of the U.S. stock market and corporate America. Buying an S&P 500 index fund can be a great, simple investment for most individual investors because of the diversification benefits it offers. A fund that tracks the Dow Jones would not offer the same benefits.
- we went: The S&P 500 is a market cap-weighted index, meaning the largest companies will make up the largest portion of the index, while the Dow is price-weighted, meaning the companies with the highest stock prices will have the greatest weight in the index.
In short
The Dow tracks the stock performance of 30 leading American companies. The index is price-weighted and dates from 1896, making it one of the oldest stock market indices. It’s not as diversified as broader indexes like the S&P 500, but it still provides a picture of how the stock market and major companies are performing.
