What's the easiest way to trade the Dow?

Answer 1

buy an ETF that tracks the dow like the diamonds.

Answer 2

The previous answers are correct, but why would you want to? The Dow Jones Industrial Average is a poorly constructed index that doesn't really measure anything very well. It was created in the 19th century, when people didn't have much mathematical knowledge about such things. The only reason that it is still reported is that it has been reported continuously for longer than any other index and people expect it. A much better index for the general market would be the S&P 500 which is tracked by SPY

Answer 3

The easiest way for the average investor to trade the Dow Jones Industrial Average (DJIA), or another index, is through either index funds or an exchange traded funds (ETF).

An index fund is simply a type of mutual fund that tracks the underlying index (DJIA). You can often purchase these through a broker, bank or even from the fund company directly.

An ETF is similar in nature to a mutual fund but trades like a stock in that you can buy and sell during market hours. This is in contrast to mutual funds which are bought or sold after the market has closed.

For the DJIA, the ETF ticker is DIA and for the Dow Jones Transportation Average the ticker is IYT.

One thing to note is that due to the fees within index funds and ETFs as well as how they are constructed make it difficult for you to get the exact performance of the underlying index (DJIA in this case). However, the difference is usually minor and is not a huge deterrent in purchasing these products.

The other options for investors is to purchase options and futures on the underlying index. However, these instruments are considerably more advanced with a different set of risks, which make them a less attractive choice for the average investor.

Answer 4

Based on your question, it sounds like your newer to investing. There's a fair amount of theory behind the Dow, so if you're only looking for a fund that focuses on the Dow, the recommendations already made to this question should help you get started just fine.

If, on the other hand, you want to get deeper into trading and theory associated with the Dow, a good publication is called Dow Theory Forecasts.

You can buy it directly from the publisher for $24.95 - http://www.dowtheory.com - or you can buy a year subscription for $40 less - $259.00 at http://www.newspaper-magazine.com/dow-theory-forecasts-p-209.html

Good luck!

Answer 5

DIA is an ETF that tracks the dow

Answer 6

DIA