So I've been looking at Dow Jones and the stocks they have that are listed on wikipedia. What is the difference if I buy these stocks individually myself versus buying the Dow Jones? Is there a difference?
I feel that it is possible that Dow Jones people take a little percentage out of the earnings of those stocks and put them all together in a bunch to make it simpler with a tiny added fee. However, if there is an advantage to getting each stock individually I might consider this as an option.
Wed Feb 10, 2016 8:23 am
oldguy Senior Member
Cash: $ 717.80
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quote: I feel that it is possible that Dow Jones people take a little percentage out of the earnings of those stocks and put them all together in a bunch to make it simpler with a tiny added fee.
No, DJ doesn't have access to the 30 DJ Industrial stocks, they get their data same as th epublic does. DJ can add up the numbers, make charts, write articles, publish analyses - and sell that information - but they cannot reach in and take a percentage of those company's earnings.
As far as you replicating the Dow30 yourself - that would be way more expensive (30 transactions) than buying a package (mutual fund, ETF, Index Fund).
Wed Feb 10, 2016 1:24 pm
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The Dow Jones Index Explained
Although the Dow Jones only consists of a meager 30 stocks, some may say that the index couldn’t be of any value. This is a common misconception because the Dow Jones holds 30 of the most highly capitalized and influential companies in the U.S. economy.
Until now the Dow Jones index is still one of the most reliable and trusted index. It is the Media’s most referenced index in the U.S. Market because is remain a trusted indicator of market trends.
The DJIA still lives up to everyone’s expectation as reliable economic market indicator. As long as the Dow contains stocks from major companies during any given period, the Dow will remain to be a standard when it comes to financial indicators.