what is the dow on the nyse and what is the formula and the componets of the formula

Hello,

Thanks for using Google. A very interesting question. 

There are many ways to measure how the market is doing. The most
popular in the US are the Dow Jones Industrial Average (DJIA) and the
S&P 500. There are many differences between these two indices - most
notably, the number of firms. The Dow has only 30 firms whereas the SP
500 has 500 firms.  Additionally, until late 1999, the Dow was made up
of exclusively of stocks that trade on the NYSE. There are now two
exceptions (Intel and Microsoft, who are both NASDAQ-firms. The major
difference in the two indices is in how they are calculated. The Dow
is a price weight index.

The DJIA is designed to be a measure of the performance of the overall
market. Thirty tried and true stocks make up the average. Here is a
complete list of all the 30 companies that make the DJIA stocks.
http://www.fool.com/FoolFAQ/FoolFAQ0014.htm

Here is a page, which gives an example of how Dow is calculated.
http://www.kiplinger.com/basics/investing/indexes/dowcalc.html

Additional information from Dow site
http://www.djindexes.com/jsp/avgOverview.jsp?averageSelection=I

Something more on Dow
http://www.kiplinger.com/basics/investing/indexes/dow.html

One more example of how Dow is calculated.
http://stocksquest.thinkquest.org/10326/market_simulation/dow_calculated.html

Search term used:

how dow is calculated:
://www.google.com/search?num=25&hl=en&lr=&ie=UTF-8&oe=utf-8&q=how+dow+is+calculated&btnG=Google+Search

I hope this will help. Feel free to ask for clarification and if you
are satisfied with my answer, then do rate it.

Regards
netcrazy

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Request for Answer Clarification by hyram-ga on 26 Jul 2002 06:19 PDT

how is the divisor of the dow calculated?

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Clarification of Answer by netcrazy-ga on 26 Jul 2002 08:43 PDT

Hello,

The Dow was first computed using the Dow Divisor on September 10,
1928.
Here is an explanation of how this divisor is calculated. 

"Assume that the prices of the 30 stocks summed to $3,000. Then the
30-stock average price would be $3,000 divided by 30, or 100.00. If
one of the thirty stocks was quoted at $200, but then split two-for-
one so that its price fell to $100, the sum of prices would be only
$2,900. To maintain the Average at its actual level of 100.00, the
divisor of the Average is systematically altered. Since $2,900 divided
by 100.00 equals 29, the new divisor is set at 29, down from 30, in
effect preserving the average price at $100 ($2,900 divided by 29
still equals 100.00)."
Check out more about this:
http://www.fool.com/ddow/historyofthedow6.htm

Here is one more example of how this divisor is calculated:
http://www.nni.nikkei.co.jp/FR/FEAT/plunge/plunge_com.html

I hope this helps

Regards,
netcrazy

And I always thought Dow Jones was the name of a Welsh steam engine
driver :) (for the Brits!)

You may find some more general info. here:
http://www.howstuffworks.com/stock.htm

You forgot about that other index, the "S" in "P" :) Boy would my dad kill me!

an article on the subject is available at:
http://www.investopedia.com/articles/02/082702.asp