Dow Jones Transportation Average

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The Dow Jones Transportation Average (DJTA, also called the "Dow Jones Transports") is a U.S. stock market index from S&P Dow Jones Indices of the transportation sector, and is the most widely recognized gauge of the American transportation sector. It is the oldest stock index still in use, even older than its better-known relative, the Dow Jones Industrial Average (DJIA).[1]

Components[edit]

Dow Jones Transportation Average 1896–2012

The index is a running average of the stock prices of twenty transportation corporations, with each stock's price weighted to adjust for stock splits and other factors.[1] As a result, it can change at any time the markets are open. The figure mentioned in news reports is usually the figure derived from the prices at the close of the market for the day.

Changes in the index's composition are rare, and generally occur only after corporate acquisitions or other dramatic shifts in a component's core business. Should such an event require that one component be replaced, the entire index is reviewed.[2] As of April 2010, the index consists of the following 20 companies:[2][3] Alaska Air Group replaced AMR corp. on December 2, 2011 after AMR corp. filed for bankruptcy protection.[citation needed] Effective October 30, 2012, Kirby Corp. replaced Overseas Shipholding Group Inc.[4]

Corporation Ticker Industry
Alaska Air Group, Inc. ALK airlines
C.H. Robinson Worldwide, Inc. CHRW trucking
Con-Way, Inc. CNW trucking
CSX Corp. CSX railroads
Delta Air Lines. DAL airlines
Expeditors International EXPD delivery services
FedEx Corporation FDX delivery services
GATX Corp. GMT business support services
JB Hunt Transport Services, Inc. JBHT trucking
JetBlue Airways Corp. JBLU airlines
Kansas City Southern KSU railroads
Kirby Corp. KEX marine transportation
Landstar System, Inc. LSTR trucking
Matson, Inc. MATX marine transportation
Norfolk Southern Corp. NSC railroads
Ryder System, Inc. R transportation services
Southwest Airlines, Inc. LUV airlines
Union Pacific Corp. UNP railroads
United Continental Holdings UAL airlines
United Parcel Service, Inc. UPS delivery services

(as of April 2013)

History[edit]

The average was created on July 3, 1884 by Charles Dow, co-founder of Dow Jones & Company, as part of the "Customer's Afternoon Letter". At its inception, it consisted of eleven transportation-related companies: nine railroads and two non-rail companies. They were the following:

As a result of the dominating presence of railroads, the Transportation Average was often referred to as "rails" in financial discussions in the early and middle part of the 20th Century.

Price history[edit]

In 1964, the index first broke 200, slightly over where it was in 1929.

In 1983, the index first broke 500. In 1987, the index broke 1000.

The index broke above the mid-5000s to begin a run of record highs on January 15, 2013, at a time when the better-known Industrials stood about 5% below all-time highs achieved more than five years earlier. By May, the Industrials and all other major indexes except the NASDAQ group were making all-time highs, including the Transports, which reached new closing and intraday records above the 6,500 level. On October 24, 2013, the Transports closed at 7022.79, for its first close above 7000 points. It closed the year at a record high of 7400.57. On May 27, 2014, it first closed above 8000 points.[5]

Investing[edit]

The index is tracked by an exchange-traded fund, iShares Transportation Average (NYSE ArcaIYT).

See also[edit]

References[edit]

External links[edit]