Difference Between NYSE and Dow Jones

The first obvious difference between the two is that NYSE is an exchange, whereas DOW is an index which only tracks the performance of a handful of stocks, which are generally market leaders.

The Dow Jones indices will be prepared by following the stock prices of 30 selected companies which include widely renowned companies such as Microsoft, Intel, JP Morgan Chase, McDonald’s , Bank of America etc, known to many as the Dow Jones industrial Average.

The NYSE is an exchange where people buy and sell stocks. The exchange simply facilitates trading for individuals, and deals with usually stocks of renowned companies, especially those mentioned in the Dow Jones index. Here traders execute the selling and buying of stock of behalf of their clients or investors. All stock related information will be present and an auction environment will be established with the goal of bringing buyers and sellers together. Although the exchange is not obligated to commit their own capital, they sometimes do in order to stabilize the information on certain stocks. With greater innovation in technology, stocks on the NYSE can be traded electronically, paving way for a hybrid Market.

Dow Jones index was simply created for the benefit of the entire market, where individuals can reduce their efforts in making the right market decisions by keep track of the hottest and most sought after stocks. However, NYSE entertains trading of other renowned companies as well and share a market cap of $ 14.242 trillion (Dec 2011). The exchange has seen many ups and downs, including the financial meltdown in 2008.


  • 1


    New York Stock Exchange is located at 11 Wall Street, Lower Manhattan, New York, United States. It is arguably the world’s largest exchange with an average daily trading of approx US $ 153 billion (2008 figures). While most of the information is now carried out electronically, floor trading is still prevalent for those companies, whose stock is less liquid. The exchange is operated by NYSE Euronext, following the merger which took place in 2007.

    - Image courtesy: solari.com

  • 2


    Dow Jones & Company is an American financial information firm, founded by Charles Dow, Edward Jones and Charles Bergstresser in 1882, with the aim of creating an index which would serve as a benchmark for the stock market conditions. Currently that benchmark incorporates the 30 most reputable American firms, helping individuals gauge the performance of the stock market. This is known as the Dow Jones Industrial average which is weighted by stock price.

    - Image courtesy: championship.mql5.com

Leave a Reply

Your email address will not be published. Required fields are marked *

4 × = thirty six