Diamonds

What is the Diamonds (DIA) ETF?

The Diamonds ETF is the common name for the SPDR Dow Jones Industrial Average ETF Trust, which trades under the ticker DIA on NYSE Arca. Launched in 1998 and managed by State Street Global Advisors, DIA seeks to replicate the performance of the Dow Jones Industrial Average (DJIA) by holding the same 30 blue‑chip, price‑weighted stocks in proportion to their DJIA weights.

How the ETF works

• Structure: DIA holds the 30 DJIA constituent stocks (plus some cash), arranged in the same price‑weighted proportions used by the index.
• Trading: Shares trade like a common stock on an exchange during market hours. Investors can buy, sell, short, or trade DIA on margin. Options markets provide additional trading strategies.
• Manager: State Street Global Advisors maintains the fund and updates holdings to match DJIA changes.

Key benefits

• Diversification in a single trade: Exposure to 30 large U.S. companies across multiple sectors.
• Liquidity: Large market capitalization and active trading generally make it easy to enter and exit positions.
• Low expense ratio: Generally lower operating cost compared with many actively managed funds (historically around 0.16%).
• Accessibility: Tradable in regular brokerage accounts and eligible for tax‑advantaged accounts like IRAs and 401(k)s.

Risks and considerations

• Market risk: DIA closely mirrors the DJIA, so it is subject to broad U.S. equity market swings.
• Concentration: The fund contains only 30 stocks and is price‑weighted, so higher‑priced constituents exert greater influence.
• Not insured: Like all ETFs, DIA is not FDIC insured and can lose value.
• Individual company risk: Performance depends on the 30 constituent companies and is exposed to sector or company‑specific events and geopolitical risks.

Performance and statistics (examples)

Note: Fund figures change over time. Representative historical figures reported in late 2023 include:
* Expense ratio: ~0.16%.
* Heaviest holdings (end of 2023): UnitedHealth Group, Microsoft, Goldman Sachs, Home Depot, McDonald’s.
* UnitedHealth weight: ~9.93% (beginning of December 2023).
* Net assets: over $31 billion (Dec. 5, 2023).
* Shares outstanding: ~86 million (Dec. 5, 2023).
* Example short‑term NAV moves: one‑month NAV −3.43% and quarter‑to‑date NAV −2.14% (as of Sept. 30, 2023).
* Longer‑term: the fund has delivered positive returns since inception, but past performance is not a guarantee of future results.

Always check the fund’s current prospectus and up‑to‑date factsheet for the latest holdings, weights, fees, and performance data.

Diamonds (gemstones) vs. Diamonds ETF

Physical diamonds are a different investment: they tend to be illiquid, lack transparent pricing, incur high transaction and grading costs, and can be difficult to value reliably. A specialized diamonds/gemstone ETF (GEMS) once existed but was later liquidated. Indices such as the IDEX Diamond Index now track diamond prices, but direct investment in physical gemstones remains challenging for most investors.

Bottom line

DIA (the Diamonds ETF) provides a straightforward, liquid way to gain exposure to the Dow Jones Industrial Average and the performance of 30 major U.S. companies through a single traded vehicle. It suits investors seeking blue‑chip exposure with low operating costs and intraday trading flexibility, but it carries the same market and company‑specific risks as broad U.S. equities.