What Is the Dow Jones Industrial Average?

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The Dow Jones Industrial Average is a company stock index made up of 30 American companies that have been around for a long time. Discover how the Dow Jones is used as a snapshot reference of the market on any given day with help from a registered financial consultant in this free video on investments and personal finance.

Part of the Video Series: Beginner Investing
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Video Transcript

This is financial adviser Patrick Munro talking about an index known as the Dow Jones Industrial Average. The Dow Jones Industrial Average is a company stock index made up of only 30 companies. They're 30 American companies that have been around for a long time. They're a good snapshot of what the market is doing is any particular given day and on fact on the news reels that you'll see on CNBC and CNN and Fox News, the index is shown on a regular second by second basis during the time the markets are open everyday from 9:30 until the market close at 4:00 in the afternoon. There's usually a 3 digit number associated with the movement of the Dow. Could be a 2 digit number on a slow day and that'll be up in the case of green, as it's shown on television, and down it'll show red. The Dow Jones Industrial Average is perhaps not the best indicator, rather it's the SMP 500 which is 500 stocks. But the Dow because it's been around for such a long time is still given an honorable mention and some individuals pay close attention to it and you should too. This is financial adviser Patrick Munro talking about the Dow Jones Industrial Average.

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