The 3 Things Average Investors Need to Know About the Dow's Reshuffle

For millions of Americans, the Dow Jones Industrial Average (^DJI) is the primary way they keep track of what's happening with the stock market. The 30 stocks that make up the Dow are all well-known industry leaders with proven track records of long-term success. As a whole, the Dow seeks to include a mix of companies that are representative of the various industry groups that make up corporate America.

Many other benchmarks frequently add and remove companies from their ranks. The Dow, though, tends to be a lot more stable. That's one reason why Tuesday's announcement that three new Dow members -- Goldman Sachs (GS), Visa (V), and Nike (NKE) -- will replace three of the average's existing component companies -- Bank of America (BAC), Alcoa (AA), and Hewlett-Packard (HPQ) -- was remarkable.

It's been nine years since the Dow made such a big change in membership all at the same time.