The Dow Jones Industrial Average (DJIA), also known as the Dow, is a stock market index that tracks 30 of the largest blue-chip companies on the New York Stock Exchange and the Nasdaq. The index was founded in 1896 by Charles Dow and Edward Jones, who also created the Dow Jones Transportation Average. It’s a price-weighted index that acts as a barometer for the US economy. The Dow is maintained by S&P Dow Jones Indexes and is the second-oldest US market index, second only to the Dow Jones Transportation Average.
How to invest in the Dow Jones
There are two ways to invest in the Dow Jones: stocks and ETFs.
Purchasing stocks allows you to pick and choose which companies you’d like to support. You could buy one share in each of the 30 companies in the Dow or select a few stocks. Stocks offer a targeted investment opportunity and tend to have greater profit potential but have one major downside: limited exposure. Many of the stocks in the Dow are worth hundreds of dollars, so it can be expensive to invest.
If it’s broad market exposure you’re interested in, consider investing in an exchange-traded fund (ETF). ETFs are a less expensive way to gain exposure to the market, as these funds track the entire index. ETFs tend to be more stable than individual stocks but come with fees that typically range from 0.03% to 2.5%.
Before you can swap stocks or ETFs, you’ll need a brokerage account. Here’s a breakdown of the investment process:
Open a brokerage account.There’s no shortage of online brokerages, so vet your options carefully, taking fees, research tools and investor feedback into account.
Deposit funds.Once you’ve set up an account, you’ll need to deposit funds before you can begin trading.
Select your securities.Use your platform’s research tools to narrow down stock and ETF options.
Monitor your investments. Log in to your brokerage account to track your investments.
What ETFs track the Dow Jones?
SPDR Dow Jones Industrial Average ETF (DIA)
iShares Dow Jones US ETF (IYY)
ProShares Ultra Dow30 (DDM)
ProShares UltraPro Dow30 (UDOW)
ELEMENTS Dogs of the Dow (DOD)
What stocks are in the Dow Jones?
Company
Exchange
Stock code
Industry
3M
NYSE
NYSE: MMM
Conglomerate
American Express
NYSE
NYSE: AXP
Financial services
Apple Inc
Nasdaq
AAPL
Information technology
Boeing
NYSE
NYSE: BA
Aerospace and arms
Caterpillar Inc
NYSE
NYSE: CAT
Construction and mining
Chevron Corporation
NYSE
NYSE: CVX
Petroleum industry
Cisco Systems
Nasdaq
CSCO
Information technology
The Coca-Cola Company
NYSE
NYSE: KO
Food industry
Dow Inc
NYSE
NYSE: DOW
Chemical industry
ExxonMobil
NYSE
NYSE: XOM
Petroleum industry
Goldman Sachs
NYSE
NYSE: GS
Financial services
The Home Depot
NYSE
NYSE: HD
Retailing
IBM
NYSE
NYSE: IBM
Information technology
Intel
Nasdaq
INTC
Information technology
Johnson & Johnson
NYSE
NYSE: JNJ
Pharmaceuticals
JPMorgan Chase
NYSE
NYSE: JPM
Financial services
McDonald’s
NYSE
NYSE: MCD
Food industry
Merck & Co
NYSE
NYSE: MRK
Pharmaceuticals
Microsoft
Nasdaq
MSFT
Information technology
Nike
NYSE
NYSE: NKE
Apparel
Pfizer
NYSE
NYSE: PFE
Pharmaceuticals
Procter & Gamble
NYSE
NYSE: PG
Consumer
The Travelers Companies
NYSE
NYSE: TRV
Financial services
UnitedHealth Group
NYSE
NYSE: UNH
Managed health care
United Technologies
NYSE
NYSE: UTX
Conglomerate
Verizon
NYSE
NYSE: VZ
Telecommunication
Visa Inc
NYSE
NYSE: V
Financial services
Walmart
NYSE
NYSE: WMT
Retailing
Walgreens Boots Alliance
Nasdaq
WBA
Retailing
The Walt Disney Company
NYSE
NYSE: DIS
Broadcasting and entertainment
Compare platforms for trading the Dow Jones
Invest in the Dow Jones by signing up for a brokerage account with any of the following platforms:
1 - 9 of 9
Why should I invest in the Dow Jones?
The Dow tracks 30 of the largest and most profitable publicly traded companies in the US. These companies are hugely successful and as a result, tend to offer stable earnings. Individually buying into the Dow’s tracked stocks is expensive, but ETFs offer simplified, broad market exposure with a single purchase. The Dow Jones is designed to act as a barometer for the US economy, so investing in this index serves as an opportunity for investors to keep their finger on the pulse of the market.
What are the risks of investing in the Dow Jones?
No index is foolproof and no investment is risk free. The Dow Jones is one of the most reputable indexes on the market, but there are drawbacks to consider before you invest. It’s primary drawback is that it’s limited. Sure, the 30 companies it tracks are among the most successful on the market — but compare this to the 500 companies tracked by the S&P 500 or the 3,000 companies tracked by the Russell 3000, and the Dow Jones begins to look more restrictive than most. Financial experts argue that the Dow Jones fails to account for the small- to mid-cap stocks that represent an important aspect of the US economy. One way to combat this shortcoming is to invest in indexes that focus on smaller companies, like the Russell 2000.
How is the Dow Jones performing?
Use the graph below to explore the historical performance of the Dow.
Bottom line
As one of the oldest indexes on the market, the Dow Jones may be a sensible investment option for those looking to invest in well-established blue-chip companies. But whether or not the Dow is a prudent choice for your portfolio depends on your risk tolerance and investment goals. Explore your brokerage account options on different trading platforms to find the account best suited to your needs.
Paid non-client promotion. Finder does not invest money with providers on this page. If a brand is a referral partner, we're paid when you click or tap through to, open an account with or provide your contact information to the provider. Partnerships are not a recommendation for you to invest with any one company. Learn more about how we make money.
Finder is not an advisor or brokerage service. Information on this page is for educational purposes only and not a recommendation to invest with any one company, trade specific stocks or fund specific investments. All editorial opinions are our own.
Tom Stelzer is a writer for Finder specialising in personal finance, including loans and credit, as well as small business and business loans. He has previously worked as a freelance writer covering entertainment, culture and football for publications like FourFourTwo and Man of Many. He has a Master of Media Arts and Production and Bachelor of Communications in Journalism from the University of Technology Sydney. See full bio
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