Mike Richman of Investor’s Business Daily writes about how Wall Street Journal co-founder Charles Dow revolutionized investing.
Richman writes, “But creating a lasting stock market measure happened in steps. In 1882, he and his business partner, Edward Jones, launched Dow Jones & Company, which published a financial news bulletin that included a daily stock average. This was a forerunner of the famous Dow Jones Industrial Average — one of the oldest measures of U.S. stocks.
“Dow (1851-1902) created this early average, which consisted of nine railroad companies, one steamship line and Western Union, to predict market trends.
“But Dow knew he could do better. He envisioned an average that better represented the overall market and would signal whether it was advancing or retreating. In his mind, it was too difficult to fully understand market trends by tracking the ups and downs of individual stocks. Stocks were viewed warily at the time, with bonds the investment of choice.
“Dow wanted to make stocks more appealing and create a clear barometer of the U.S. economy that cut through market manipulation and hidden corporate data.”
Read more here.
