Dow Jones Indexes Launches U.S. Total Market Index; Incorporates New Market Sector/Industry Group Classification Structure.PRINCETON, N.J.--(BUSINESS WIRE)--Dec. 6, 1999-- Dow Jones Dow Jones the best known of several U.S. indexes of movements in price on Wall Street. [Am. Hist.: Payton, 202] See : Finance Indexes has announced plans to launch the Dow Jones U.S. Total Market Index (DJTMI-US), the first index of a new benchmark-level series, in February 2000. The index is designed to provide 95% representation of the U.S. market, and incorporates Dow Jones Indexes' new market sector/industry group classification structure. The Dow Jones U.S. Total Market Index is constructed to improve upon the design of many established benchmarks. Whereas benchmark indexes typically maintain a fixed number of components, the Dow Jones U.S. Total Market Index covers a constant 95% of the market's capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. . This fixed-percentage design provides more consistent long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. coverage, particularly during periods of rapid market expansion. The index is built using a bottom-up approach. First, the index universe is defined as all NYSE NYSE See: New York Stock Exchange , Amex and Nasdaq stocks, excluding those with less than six months' trading history, foreign issues, non-common equity issues, illiquid Illiquid An asset or security that cannot be converted into cash very quickly (or near prevailing market prices). Notes: A house is a good example of an illiquid asset. See also: Cash, Liquidity Illiquid In the context of finance. stocks and stocks owned to a large degree by a single person, family or organization. The index universe is then separated into Large-, Mid- mid- pref. Middle: midbrain. and Small-Cap Small-cap A stock with a small capitalization, meaning a total equity value of less than $500 million. small-cap 1. Of or relating to the common stock of a relatively small firm having little equity and few shares of common stock universes according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. market value. Indexes for the Large-Cap and Mid-Cap segments include 100% of the stocks from their respective universes, whereas the Small-Cap Index covers a smaller percentage of its universe--50%--to avoid adding very small, little-traded stocks in the index. The three sub-indexes are combined to form the Dow Jones U.S. Total Market Index. The DJTMI-US is the first index to incorporate Dow Jones Indexes' new market sector / industry group classification structure. Revamped to provide a better reflection of today's economy, the new hierarchy system now comprises 10 market sectors, 40 industry groups and 70 industry sub-groups. Major changes from the earlier system include the addition of Healthcare and Telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. sectors; revisions to the Technology, Industrial, Consumer Non-Cyclical and Utilities sectors; and the discontinuation dis·con·tin·u·a·tion n. A cessation; a discontinuance. Noun 1. discontinuation - the act of discontinuing or breaking off; an interruption (temporary or permanent) discontinuance of the Independents sector. More details are contained in the "Key Facts" section of this release. The DJTMI-US is the flagship index of the new Dow Jones Total Market Index Series (DJTMI). The DJTMI will expand to include additional countries in 2000, and ultimately will cover all of the world's major financial markets. Dow Jones Indexes is a premier global provider of investable indexes, including the Dow Jones Averages Dow Jones Averages A trademark used for three indexes of the relative price of selected industrial, transportation, and utility stocks based on a formula developed and periodically revised by Dow Jones & Company, Inc. , the Dow Jones Global Indexes The Dow Jones Global Indexes (DJGI) are a family of real time international equity indexes, including world, region, and country indexes and economic sector, market sector, industry-group, and subgroup indexes. , the pan-European Dow Jones STOXX Indexes, the Dow Jones-AIG Commodity Index The Dow Jones-AIG Commodity Index [DJ-AIGCI] is a broadly diversified index that allows investors to track commodity futures through a single, simple measure. The DJ-AIGCI is composed of futures contracts on physical commodities. , the Dow Jones Islamic Market Indexes, the Dow Jones Internet Indexes, the Dow Jones Global Titans The Dow Jones Global Titans 50 Index was created to reflect the globalization of international blue chip securities in the wake of mergers and the creation of mega-corporations. Index, the Dow Jones Extra Liquid Series and the Dow Jones Sustainability Group Indexes. Dow Jones Indexes is part of Dow Jones & Company, which publishes the world's most vital business and financial news and information. In addition to Dow Jones Indexes, Dow Jones & Company (NYSE: DJ; www.dj.com) publishes The Wall Street Journal and its international and interactive editions, Barron's and SmartMoney magazines and other periodicals, the Dow Jones Newswires Dow Jones Newswires is the real-time financial news organization owned by Dow Jones. Founded in 1882, its primary competitors are Bloomberg L.P. and Reuters. The company reports more than 420,000 subscribers -- including brokers, traders, analysts and fund managers -- as of July , dowjones.com, and the Ottaway group of community newspapers. Dow Jones is co-owner with Reuters group of Factiva, and with NBC NBC in full National Broadcasting Co. Major U.S. commercial broadcasting company. It was formed in 1926 by RCA Corp., General Electric Co. (GE), and Westinghouse and was the first U.S. company to operate a broadcast network. of the CNBC CNBC Center for the Neural Basis of Cognition (artificial intelligence) CNBC Consumer News and Business Channel CNBC Congress of National Black Churches, Inc. television operations in Europe and Asia. Dow Jones also provides news content to CNBC in the U.S. -0-
KEY FACTS
Dow Jones U.S. Total Market Index
Index Coverage
DJTMI-US Broad Index: 95% of the total U.S. market
DJTMI-US Large-Cap Index: 100% of the large-cap market
DJTMI-US Mid-Cap Index: 100% of the mid-cap market
DJTMI-US Small-Cap Index: 50% of the small-cap market
Market Sector Weighting
Basic Materials 2%
Consumer, Cyclical 14%
Consumer, Non-Cyclical 9%
Energy 5%
Financial 16%
Healthcare 11%
Industrial 12%
Technology 21%
Telecommunications 7%
Utilities 3%
History
Available back to base date: January 1, 1987
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KEY FACTS
New Dow Jones Market Sector / Industry Group
Classification Structure
Composition
10 Market Sectors
Basic Materials
Consumer, Cyclical
Consumer, Non-Cyclical
Energy
Financial
Healthcare
Industrial
Technology
Telecommunications
Utilities
40 Industry Groups
70 Industry Sub-Groups
Major (Sector-Level) Changes
- New: Healthcare Sector
The new Healthcare sector consists of three industry groups:
Medical Products, Healthcare Providers and
Pharmaceutical & Biotechnology.
- New: Telecommunications Sector
The new Telecommunications sector
consists of two industry groups: Fixed Line Communications and
Wireless Communications.
- Discontinued: Independents Sector
The Plantations industry sub-group was moved into the
Consumer, Non-Cyclical sector. The other industry sub-group
was dissolved; its companies were re-classified
into other sectors.
- Revised: Technology Sector
Several industry sub-groups previously
under the Technology sector were reclassified into the Healthcare
and Industrial sectors. The Technology sector now consists of two
industry groups: Software and Hardware & Equipment.
- Revised: Industrial Sector
The Industrial sector expanded to
incorporate industry sub-groups from the revised Technology
sector. The Industrial sector now consists of eight industry
groups: Construction and Materials; Industrial Equipment;
Industrial Services; Containers and Packaging; Industrial,
Diversified; Industrial Transportation; Aerospace; and
Transportation Equipment.
- Revised: Consumer, Non-Cyclical Sector
Several industry sub-groups previously under the Consumer,
Non-Cyclical Sector were re-classified into the Healthcare
sector. Added to the Consumer, Non-Cyclical sector was one
industry sub-group from the discontinued Independents sector. The
Consumer, Non-Cyclical sector now consists of six industry
groups: Food & Beverage Makers; Tobacco; Consumer Services; Food
Retailers & Wholesalers; Household Products; and Cosmetics.
- Revised: Utilities Sector
The Telecommunications industry group was removed from the
Utilities sector to form a new sector. Four industry
sub-groups, covering regional electric utilities, were
discontinued. The Utilities sector now consists of three
industry groups: Electric Utilities, Gas Utilities and Water
Utilities.
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