The State of Dow Jones in 2021
The Dow Jones Industrial Average, although omnipresent in news headlines, is not necessarily well understood by the average citizen. Simply put, the Dow Jones uses and compiles data from the stock performance of 30 large corporations’ stocks. They then use this to assess the overall state of the U.S. stock market at a given point in time. Some argue that the Dow is not the best or most accurate index out there. However, it is undoubtedly the most famous and therefore the most influential.
Recent history
The year 2020 saw many record-breaking vacillations in the Dow. After the extent of the coronavirus pandemic became clear in early March, a stock market crash began. On March 9, the Dow fell a record 2,013.76 points from 25,864.78 to 23,851.02. There were two more record-setting plunges in the following days, on March 12 and March 16. However, by the time November rolled around, the Dow Jones had climbed back up to hit an all-time high of 30,045.84 points on November 24 after the Joe Biden election confirmation.
Today’s Dow Jones
As the new year begins amongst widespread social and political chaos, many are wondering about the direction of the Dow Jones. So far, despite the continual unease and uncertainty, today’s Dow Jones is looking much better than it did at many points during 2020. As such, many strategists are predicting double-digit growth this year.
This optimistic outlook is due in large part due to the emergence of vaccines for the coronavirus. However, there is a risk that setbacks and disappointments will unsettle investors and precipitate downturns. Furthermore, as always, unpredictable occurrences like Trump’s recent impeachment may affect the stock market. Both in the short, and even in the long-term.
How to invest
If you’d like to get in on the action but don’t have experience with investing, don’t worry. According to Money Morning, a leading provider of financial advice, news and analysis, “investing in the Dow is easy.” The Money Morning article linked above goes on to state that “there are three main ways to invest: exchange-traded funds, options contracts, or futures contracts.”
Money Morning suggests Apple stock as a trustworthy option if you’re looking to buy a stock that is on the Dow. Otherwise, there are plenty of great starter investments that aren’t listed on the Dow. One way to find out what stocks will make for good investments in the present moment is simply to search Google. This can show the best stocks to invest in now. Often known as growth stocks, these are likely to increase in value at a rate significantly faster growth rate than the market.
In summary, on average, experts have a positive outlook towards the performance of the Dow Jones in 2021. This means that it’s a great time for angel and other types of investments. Especially as things should only be looking up from here in regards to the stock market.
