Dow Jones Transportation Average (DJT): A Comprehensive Overview
What is the Dow Jones Transportation Average (DJT)?
The Dow Jones Transportation Average (DJT) is a price-weighted stock index that tracks the stock performance of 20 large, well-known U.S. transportation companies. These companies include airlines, railroads, trucking companies, and logistics providers.
How is the DJT Calculated?
The DJT is calculated by taking the sum of the share prices of the 20 component companies and then dividing that total by the Dow Jones Transportation Average Divisor. The divisor helps to ensure that the DJT does not become too heavily influenced by any single stock.
History of the DJT
The DJT was created in 1884 by Charles Dow, the co-founder of Dow Jones & Company. The index originally consisted of 12 railroads, but it has been expanded over the years to include a broader range of transportation companies.
Importance of the DJT
The DJT is an important indicator of the overall health of the transportation sector. Given the importance of the sector to the U.S. economy, the DJT can provide insights into the broader economic outlook.
How to Invest in the DJT
You can invest in the DJT through a variety of financial products, including exchange-traded funds (ETFs) and mutual funds. Some of the most popular DJT-tracking ETFs include the SPDR Dow Jones Transportation ETF (ITA) and the Invesco Transportation ETF (IVT).
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