Topic: How To Invest

Pat: Does the removal of Alcoa from the Dow Jones Industrial Average change your view of this company? Best wishes.

Article Excerpt

Effective September 23, 2013, the Dow Jones Industrial Average, which consists of 30 companies, removed Alcoa (symbol AA on New York), Hewlett-Packard (symbol HPQ on New York) and Bank of America (symbol BAC on New York) and replaced them with Nike (symbol NKE on New York), Visa (symbol V on New York) and Goldman Sachs (symbol GS on New York). The reasons for Alcoa’s removal centred around its low stock price and its declining role in a U.S. economy that is less oriented toward heavy manufacturing. The Dow Jones Industrial Average was created in 1896 by Charles H. Dow, one of the founders of The Wall Street Journal. The original index had 12 companies, but it gradually increased to 30 by 1928. The index is calculated and published by S&P Dow Jones Indices, a joint venture owned by McGraw-Hill, CME Group and Dow Jones. A small committee decides which companies are added to or dropped from the Dow. Being dropped from the Dow…