SDIAState Street SPDR Dow Jones Industrial Average ETF Trust

DIA tracks the Dow Jones index — thirty companies weighted by share PRICE rather than by the size of the business.

The defining feature is the weighting method. A company's weight is set by the price of one share rather than by capitalisation: a five-hundred-dollar stock moves the index ten times more than a fifty-dollar one, regardless of which company is larger. It is a methodological anachronism inherited from the nineteenth century.

The composition is thirty companies chosen by a committee rather than by formal rule. With so few constituents and that weighting, the index represents the market less well than the S&P 500, and changes to its membership can visibly alter behaviour.

It nonetheless remains the most recognisable indicator of the American market in the press, and the fund on it is liquid. For broad US exposure, funds on the S&P 500 or the total market serve better — a question of methodology rather than opinion.