“Fun” Facts about the Dow Jones Industrial Average

business, lessons learned, Teaching and Education, Wall Street Journal 1 Minute

You’re still reading this post after such a captivating headline?

OK, you must really want to learn a thing or two about the DJIA.

Here we go:

  • the index was first calculated on May 26, 1896, and included just 12 firms, all manufacturing/industrial in nature, thus the name
  • here are the original 12 firms:
    • American Cotton Oil Company
    • American Sugar Refining Company
    • American Tobacco Company
    • Chicago Gas Company
    • Distilling & Cattle Feeding Company
    • General Electric
    • Laclede Gas Company
    • National Lead Company
    • North American Company
    • Tennessee Coal, Iron and Railroad Company
    • United States Leather Company
    • United States Rubber Company
  • here are the current 30
    • 3M
    • American Express
    • Amgen
    • Apple Inc.
    • Boeing
    • Caterpillar Inc.
    • Chevron Corporation
    • Cisco Systems
    • The Coca-Cola Company Inc.
    • DOW Chemical
    • Goldman Sachs
    • The Home Depot
    • Honeywell
    • IBM
    • Intel
    • Johnson & Johnson
    • JPMorgan Chase
    • McDonald’s
    • Merck & Co.
    • Microsoft
    • Nike, Inc.
    • Procter & Gamble
    • Salesforce
    • The Travelers Companies
    • UnitedHealth Group
    • Verizon Communications
    • Visa Inc.
    • Walgreens Boots Alliance
    • Walmart
    • The Walt Disney Company
  • as you can see the variety of industries has increased dramatically, now also including health care, technology, financial services, and retail firms
  • General Electric had the longest continuous presence on the index, beginning in the original index in 1896 and ending in 2018 (and just this past week announced that it will be splitting into three separate public companies)
    • and in a somewhat related note, Johnson & Johnson just announced yesterday that they will be splitting into two separate public companies
  • Procter & Gamble is now the longest continuously listed firm, having been part of the index since 1932
  • From its inception date of May 26, 1896 through May 25, 2021, the index’s average annual return has been 7.69%. This means that if you had invested $1,000 in the DJIA at the very beginning, on May 25, 2021 you would have $10.5 million.
  • the value of the index at the end of 1896 was 29.56. Yesterday, it closed at 36,100.31

But just remember: past performance is no guarantee of future results…

Source:

*image from Yahoo Finance

Published by Jim Borden

A 60-something guy trying to figure out the world, and his place in it. Happily married for 40-plus years, three wonderful sons. Accounting teacher, fitness enthusiast, blogger, reader.

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44 thoughts on ““Fun” Facts about the Dow Jones Industrial Average”

  1. The J&J news makes me laugh because they bought up a ton of companies which were split from other firms. AMO, which was split from Allergan… I think. Thrn they bought Intralase. Then they were bought by Abbott. Then Abbott split off Abbvie. J&J bought AMO. And now they’re splitting.

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  3. Wait a minute! How did I end up in economics class? I bet this is a spin-off from your earlier post and is a precursor to Borden’s Blather about to undergo a drastic price increase.

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  4. I would like to point out that if you had invested $1000 on May 26, 1986, not only would you have reaped a windfall of 10.5 million dollars, but you would also be over 125 years old. Both are equally amazing accomplishments.

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    2. Borden’s Blather when Jim is 125 years old. If you’re going to set a record for blogging, why not obliterate the old one? Now, if we can just get Dan Pink and the rest of the regular cast of characters to hang on a few more decades.

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      1. I think once I reach my goal, I’m just going to start recycling my old posts. If I do that for just about eight times, I’ll be 125 years old. I wonder if I can just set up the WordPress scheduler that far in advance… 🙂

        Liked by 1 person

  6. Interesting and fun facts. That 16-year, relatively flat area from 1966-1982, reflects a stagflation era that economists fear we are once again heading into. But as you say, past performance does not guarantee future results.

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      1. Well, the problem with the stagflation of the ’70s was that while stock prices remained level, inflation cut into their value. Therefore, in real spending terms, there was a significant decline.

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