No, General Electric (GE) is no longer a component of the Dow Jones Industrial Average (DJIA).
The Dow Jones Industrial Average and GE's Departure
The Dow Jones Industrial Average is a prestigious stock market index comprising 30 significant publicly owned companies based in the United States. These companies are often referred to as "blue-chip" firms, signifying their large size, strong reputation, and financial stability. The DJIA's composition is dynamic and changes periodically to ensure it accurately reflects the evolving landscape of the American economy and market leadership.
General Electric, a company deeply intertwined with American industrial history, was a continuous component of the DJIA for an impressive 111 years, since 1907. However, on June 26, 2018, GE was removed from the index, marking the end of its long-standing presence. This decision reflected significant shifts in GE's business structure and its reduced weighting within the broader economy compared to emerging sectors.
Why Companies Exit the Dow
Companies are removed from the DJIA when they no longer represent the broad industrial sector as effectively as other candidates, or when their economic footprint shrinks in relation to newer, growing industries. The Averages Committee, responsible for managing the index, periodically reviews its components to maintain its relevance as a key economic indicator. Factors considered include a company's reputation, sustained growth, and how well it represents its sector within the overall U.S. market.
Other Notable Companies Removed from the Dow
GE's departure is part of a historical pattern where even the most iconic companies can exit the Dow. Over the years, several other historically significant companies have also been removed from the DJIA, reflecting the constant evolution of leading American industries. Some prominent examples include:
- AT&T (T): A dominant force in telecommunications for decades.
- Sears: Once a retail powerhouse that shaped American consumerism.
- General Motors (GM): An automotive giant that played a central role in 20th-century manufacturing.
These changes underscore the flexible nature of the DJIA, designed to ensure it remains a relevant barometer of the U.S. economy's most influential companies.
Overview of Iconic Dow Removals
| Company | Primary Industry | Period of Prominence in Dow (General) |
|---|---|---|
| General Electric | Diversified Industrial/Tech | Early 20th Century - 2018 |
| AT&T | Telecommunications | Mid 20th Century - Early 2000s |
| Sears | Retail | Mid 20th Century |
| General Motors | Automotive | Mid 20th Century - Early 2000s |
For more detailed information on the Dow Jones Industrial Average and its components, you can visit Investopedia.
