The Dow Jones Industrial Average (DJIA), popularly known as the Dow Jones is an index on the US stock exchange. This index, the Dow, measures the financial performance of the companies listed on the US stock exchange. Around 30 companies are listed on this exchange the Dow index keeps track of the performance. This index has been named after a US journalist Charles Dow. He was the co-founder of Dow Jones & Company along with Charles Bergstresser and Edward Jones. At the time this index was established, only 12 companies were listed. As time passed, more and more companies joined the index. In the year 2012, this index was acquired by S&P Dow Jones Indices LLC. The S&P Dow Jones Indices LLC is a joint venture between CME Group and S&P Global. How is a company added or removed from the index? Regarding addition or removal of a company from the Dow index, the decision committee is the one to decide about it. This committee considers some factors based on which it is decided to either remove or add a company to the index. In this article you will learn about Top 5 Companies Which Were Dropped From the Dow Jones Industrial Average as shared by Insider Monkey.
Raytheon Technologies Corporation was one of the companies which was removed from the index. This company remained listed on the index for about 5 months. This company was replaced by an industrial giant, Honeywell. During the end of January, the share price of Raytheon increased as soon as the company CEO Greg Hayes announced increasing share buybacks. During the third quarter, last year, Soroban Capital Partners owned 13.93 million shares of Raytheon. These shares were worth $801.47 million. Another company that was removed from the index was Citigroup. It was removed from the Dow in 2009. Currently, 91 hedge funds have stakes in Citigroup. The value of this investment is $5.5 billion. According to Oakmark Select Fund, “Citigroup was our largest detractor for the period due to Covid-19-related concerns that have hurt the entire financial sector, as well as a handful of Citigroup-specific headlines that amplified near-term uncertainty. We believe that investors’ short-term focus can cause them to miss the bigger picture.” We discussed 2 companies in this article, you can read about other companies which were removed from the Dow at 10 Biggest Companies That Were Dropped From the Dow Jones Industrial Average (DJIA).
