What is Dow Jones Industrial Average (DJIA)?
The Dow Jones Industrial Average tracks 30 large, blue-chip US companies hand-selected by the WSJ committee. It is the oldest US stock index (1896) and is price-weighted rather than market-cap-weighted, making it less statistically rigorous than the S&P 500 but the most widely cited in mainstream news.
Formula
How to Interpret
The Dow's price-weighting means a $400 stock (e.g. UnitedHealth) has more influence than a $40 stock, regardless of company size. Most pros prefer the S&P 500 as a benchmark, but the Dow remains a media headline staple ('the Dow closed up 200 points'). India's closest analogue (in concentration, not methodology) is the Sensex (BSE 30).
Typical Ranges
Long-term return similar to S&P 500 (~9–10% nominal). Track DIA ETF for direct exposure. Avoid using Dow for serious portfolio benchmarking, use S&P 500 instead.