NEW YORK — Walgreens Boots Alliance Inc. will replace General Electric Co. in the Dow Jones Industrial Average (DJIA) effective prior to the open of trading on Tuesday, June 26.
The DJIA is a price-weighted index, and the range of prices among its 30 constitutes matter. The low price of GE shares means the company has a weight in the index of less than one-half of one percentage point. Walgreens Boots Alliance’s share price is higher, and it will contribute more meaningfully to the index. It will also help the index better represent the U.S. market and economy.
The change won’t disrupt the level of the index. The divisor used to calculate the index from the components’ prices on their respective home exchanges will be changed prior to the opening on June 26. This procedure prevents any distortion in the index’s reflection of the portion of the U.S. stock market it is designed to measure.