3 Stocks That May Be Kicked Out of the Dow Jones Industrial Average (and the 3 Stocks That Could Replace Them) – The Motley Fool
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There have been more than 50 changes to the Dow since 1896. Removing these three established companies could be next on the docket.
For more than 126 years, the Dow Jones Industrial Average (^DJI) has served as one of the most-watched barometers of Wall Street’s health. When it debuted in May 1896, it had only 12 components, virtually all of which were industrial stocks. Today, it’s a 30-component index comprised of historically profitable, mature, and diverse multinational businesses.
Yet the Dow has an inherent flaw — it’s a share price-weighted index. Instead of companies with larger market caps exerting greater influence over index price movements, such as we see occur in the S&P 500, stocks with higher share…
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