ABSTRACT
Charles Dow reputedly kept elaborate charts of many different stocks for his personal and business use in investing. The Industrial Average contained the stocks of companies that provided basic commodities, raw materials, and other necessities of life, commerce, and manufacturing. The products of these companies, such as gas, lead, and leather, were the building blocks of other developing industries. Select companies born of these new industries would eventually become part of the Dow Average. Charles Dow firmly believed that activity in the stock market was a reflection of all that was known about the financial health of the business economy. The relationship between industry and transportation led Charles Dow to create the two market averages. Another reason for two averages was to prevent manipulation: Two separate averages allowed more stocks to be listed and would make manipulation difficult. The Dow Averages are dynamic, not only in their movement but also in their composition and structure.
