What Is the Dow Jones?

The Dow Jones index is made up of 30 large-cap stocks and is used to measure the performance of the equity market.

Dow Jones Industrial Average acronym, DJIA, written on wooden blocks
(Image credit: Getty Images)

There are several ways to measure the performance of the stock market, including using the Dow Jones Industrial Average. But what is the Dow Jones?

To be exact, the Dow Jones, which is also known as the Dow or the DJIA, is a price-weighted index of 30 of the most traded stocks on the New York Stock Exchange (NYSE) and the Nasdaq. It measures the price action of these blue chip stocks, which helps show investors the direction of the stock market.

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Mark R. Hake, CFA
Contributing writer, Kiplinger

Mark R. Hake, CFA, is a Chartered Financial Analyst and entrepreneur. He has been writing on stocks for over six years and has also owned his own investment management and research firms focused on U.S. and international value stocks, for over 10 years. In addition, he worked on the buy side for investment firms, hedge funds, and investment divisions of insurance companies for the past 36 years. Lately, he is also working as Chief Strategy Officer for a tech start-up company, Foldstar Inc, based in Princeton, New Jersey.