you are interested in trading Dow Industrial Index futures it is helpful to become
familiar with the description of the Dow Industrial Index market. The Dow Jones Industrial Average is one of several
stock market indices that was created to show how certain stocks have traded. The average is computed from the stock
prices of 30 of the largest and most widely held public companies in the United States. The "industrial" portion
of the name is largely historical. Many of the 30 modern components have little to do with traditional heavy industry. The
average is price-weighted.
In order to compensate for
the effects of stock splits and other adjustments, the DJIA is currently a scaled average, not the actual average
of the prices of its component stocks. To calculate the value of the index, the sum of the component prices is divided by
a divisor, which changes whenever one of the component stocks has a stock split or stock dividend. Since the divisor is currently
less than one, the value of the index is higher than the sum of the component prices.
Dow Jones Industrial Average
the link above to download a very informative .pdf brochure entitled "Equity Products: Dow Jones Industrial Average Futures
and Options". It was published by the Chicago Mercantile Exchange. This is a must read guide for any novice or advanced
trader considering an investment in the DJIA Index futures and options.
Click here to contact a commodities broker with experience in the Dow Jones Index market.