1. What is the Dow Jones Index?

The Dow Jones Index was originally an arithmetic average stock price index compiled in 1884 by Charles Henry Dow (1851-1902), the founder of Dow Jones. The Dow Jones Index is the oldest stock index in the world, and its full name is the stock price average.

The Dow Jones index is usually referred to as the first group of Dow Jones Industrial Average in the four groups of the Dow Jones Index. The Dow Jones Index, also known as $US30, the Dow Jones Stock Price Average, is the world's most influential and widely used stock price index. It is based on a representative portion of the company's stock listed on the New York Stock Exchange and consists of four stock price averages.

On December 5, 2018 (local time in the United States), after MSCI and FTSE Russell successively included A-shares in their index system, S&P Dow Jones Indices, the world's largest financial market index provider, also Officially announced that qualified Chinese A shares that can be traded through the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect mechanism will be included in its global benchmark index with emerging market classification, which will be effective before the market opening on September 23, 2019.

2. Source

The Dow Jones Index was first compiled in 1884 by Charles Henry Dow (1851-1902), the founder of Dow Jones, and is an arithmetic average stock price index.

The original Dow Jones Stock Price Average was compiled based on the arithmetic mean of 11 stocks of representative railway companies, published in the Daily Newsletter edited by Charles Dow. The purpose of the index is to reflect the overall trend of the US stock market, covering financial, technology, entertainment, retail and other industries.

Since 1897, the Dow Jones Stock Average has begun to fall into two major categories, the industrial and transportation industries. The industrial stock price average index includes 12 stocks, the transport industry average index includes 20 stocks, and the Wall Street Journal published by Dow Jones announced it. In 1929, the Dow Jones Stock Price Average added another utility stock, bringing it to 65 stocks and continues to this day.

3. Calculation

The original calculation method of the Dow Jones stock price average index is obtained by the simple arithmetic average method. When the stock ex-dividend ex-dividend is encountered, the stock index will be discontinuous. After 1928, the Dow Jones stock price average was changed to a new calculation method, that is, the connection technology was used to count the stock ex-dividend or ex-dividend to ensure the continuity of the stock index, so that the stock index was improved and gradually extended to worldwide.

The earliest formula is: the average stock price = the sum of the prices of the stocks selected / the number of stocks selected

The current calculation formula becomes: Stock Price Average = the sum of the prices of the selected stocks / the Dow Divisor, the Dow Divisor will be affected by the split and the company integration

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