Dow Jones Indexes Launches The Europe Dow And The Asia Dow - New Regional Indexes To Use Same Guiding Principles As The Dow Jones Industrial Average - 30 Blue-Chip Stocks In Each Index

In the same year in which the Dow Jones Industrial Average (DJIA) celebrates its 115^th birthday, Dow Jones Indexes today announced the launch of two regional versions of the iconic index, The Europe Dow and The Asia Dow.

 The new indexes will operate according to the same guiding principles as the DJIA, measuring the Europe and Asia equity markets by tracking 30 leading blue-chip companies in each region.

“With the launch of these two important regional indexes, we have taken 115 years’ worth of experience from The Dow Jones Industrial Average and applied it to The Europe Dow and The Asia Dow,” said John Prestbo, Editor and Executive Director of Dow Jones Indexes. “These two indexes add to Dow Jones Indexes’ long and impressive track record of reliably delivering significant financial data.”

Of the 30 companies represented in The Europe Dow, nine claim Great Britain as their home country, the most of any nation in the index. Next, are France and Germany (five each); Switzerland (four); and Spain and Sweden (two each). Denmark, Italy and The Netherlands each have one company in The Europe Dow. (A table listing the components of The Europe Dow can be seen below.)

For The Asia Dow, seven of the component stocks are based in Japan, the most of any nation in the index; the remaining nations represented include Australia, China and Hong Kong (four each); South Korea and Taiwan (three each); and India (two). Indonesia, Malaysia and Singapore each have one company in The Asia Dow. (A table listing the components of The Asia Dow can be seen below.)

The Europe Dow launch is the latest in a significant expansion of Dow Jones Indexes’ suite of European offerings, underscoring the global index provider’s revitalised commitment to the region. So far in 2011, Dow Jones Indexes has unveiled for the European markets six dividend-focused and two real estate indexes on 20 September; two volatility index series on 13 September; and two blue-chip indexes on 20 June.

The Europe Dow and The Asia Dow are maintained by an Averages Committee that is responsible for adding and deleting stocks to the indexes. (The same committee maintains the DJIA and The Global Dow, a 150-stock index of influential corporations from around the world.) The Committee is comprised of the Managing Editor of The Wall Street Journal, the head of Dow Jones Indexes research and the head of CME Group research. The DJIA, whose 30 stocks account for 24% of the total U.S. market value, is owned by Dow Jones Indexes, part of a joint venture company owned 90 percent by CME Group Inc. and 10 percent by Dow Jones & Company, Inc., a News Corporation company.

“Having been modelled upon The Dow Jones Industrial Average -- one of the financial world’s most trusted and recognisable brands -- we believe The Europe Dow and The Asia Dow will be a welcome addition to the marketplace,” said Jamie Farmer, Executive Director, Global Business Development and Communications. “And, when viewed alongside the DJIA and The Global Dow, the new indexes offer a unique, complete ‘at-a-glance’ snapshot of the global markets.”

Component stocks for the new indexes must be publicly traded equity securities from Western Europe (The Europe Dow) and Asia/Pacific (The Asia Dow) markets that are open to foreign investment. While stock selection is not governed by quantitative rules, a stock typically is added only if the company has an excellent reputation, demonstrates sustained growth and is of interest to a large number of investors. Maintaining adequate sector representation within the indexes is also a consideration in the selection process.

Stocks in The Europe Dow and The Asia Dow are weighted equally, unlike the DJIA which uses a price-weighted methodology. Stocks in the new regional indexes are expected to be rebalanced to equal weight each September. The Europe Dow is calculated in USD and EUR; The Asia Dow is calculated in USD. 

The 30 components of The Europe Dow are:

The 30 components of The Asia Dow are: