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The DOW only represents 30 companies in the stock market, yes they are the biggest, best and oldest in the group. The NASDAQ has 2877 and 3796 in the NYSE so as you can see the DOW only represent a very small portion of the Stock Market here in the US.

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Q: What does Dow say about the stock market in general?
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An option based on the value of a stock index (like the S&P 500). It's not different than a typical stock option; the only difference is the underlying asset that determines the value of the option (an index price instead of a stock price).Stock market indices play an important role in gauging the economic health and progress of a country. Oftentimes someone will say "the Stock Market is up" or "down" but that is not necessarily a meaningful statement. Understanding how stock market indices are calculated and their history can be very instrumental in understanding the stock market as a whole.The Origin Of The Stock Market IndexAs stock markets became more and more prevalent in industrialized countries, people began to look for a "barometer" of the stock market as a whole. The very first stock market index was the Dow Jones Transportation Average, which was created by Charles Dow in 1884. It was followed shortly thereafter by many more indexes like the Dow Jones Industrial Average which, in a very modified form, is still widely publicized and followed today.How Indices Are CalculatedA stock market index is generally calculated by combining a weighted average of a set of particular stocks. For example, in the case of the Dow Jones Industrial Average, 30 stocks are weighted by price to get a measurement of the market as a whole. It should be noted that all indices are somewhat arbitrary and are more useful as indicators of relative and historical growth rather than a raw number. Additionally, in many indices stocks often times are added or removed due to bankruptcies or simply becoming less relevant than another stock. Most recently Kraft Foods replace AIG in the Dow Jones Industrial Average.Popular Stock Indices


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