DIA ETF VS SP ETF FULL
DIA ETF VS SP ETF SERIES

Equity index futures are also available on foreign stock market indices (i.e. In the United States, equity index futures are available on the S&P 500, the Nasdaq 100, the Dow Jones Industrial Average and the Russell 2000. These products were first introduced in 1982. In the United States, the most widely followed stock market indices are the Dow Jones Industrial Average, the S&P 500, the Nasdaq 100, and the Russell 3000.Įquity index futures are another avenue for traders and investors to access exposure to stock market indices. For example, speculating on direction using naked calls/ puts, or leveraging a volatility-focused approach such as a calendar spread.

DIA ETF VS SP ETF FULL

Investors and traders also use index ETFs like SPY to deploy a wide range of day trading strategies, such as scalping, news trading, trend trading, mean reversion and money flows.īecause SPY has listed options, that means the full spectrum of options trading strategies is also available to investors and traders in this ETF. For example, a trader holding a significant short gamma or short vega position might decide to deploy a short position in SPY to protect the portfolio in the event of an unexpected market correction. On the other hand, some market participants use index ETFs to hedge risk in their portfolios. Alternatively, an investor/trader that is bearish on stock prices might decide to sell or short the SPY. Bulls purchase index ETFs such as SPY when they think stock prices are set to increase. Speculation in an index ETF like SPY isn't much different than any other major asset.

DIA ETF VS SP ETF SERIES

In addition to SPY, some other well-known index ETFs include the SPDR Dow Jones Industrial Average ETF Trust (DIA), the Invesco QQQ Trust Series 1 (QQQ) and the iShares Russell 2000 ETF (IWM).ĭue to their wide acceptance and deep liquidity, index ETFs like SPY are used by a wide variety of market participants, and they are utilized to deploy a wide range of strategies.Īt a high level, the most common trading/investing approaches for index ETFs include the following:

Index ETFs are simply exchange-traded funds that seek to passively track the performance of a benchmark index. For example, the SPDR S&P 500 ETF Trust (SPY) is a widely utilized exchange-traded fund (ETF) that tracks the S&P 500.įirst established in January of 1993, SPY was the first index ETF listed in the United States. While indices themselves cannot be bought or sold, financial products that track their value are accessible to investors and traders. The S&P 500 is widely regarded as the best gauge of overall performance in large-capitalized US equities, and is comprised of 500 American companies representing a wide range of diverse market sectors. Stock market indices represent a subset of the broader stock market, and are used to measure and track the performance of that specific subset. Again, as leveraged ETFs, there are unique risks involved, and these should only be held intraday.The SPDR S&P 500 (SPY) is an Exchange Traded Fund (ETF) that tracks the performance of one of the most popular US indices, the Standard & Poor's 500 (S&P 500). The gain or loss of these inverse ETFs will be two or three times the index returns, in the opposite direction.

These are bearish leverages, meaning they anticipate a decline in the S&P 500. SPDN & SPXS: Direxion offers these 2x (SPDN) and 3x (SPXS) leveraged ETFs.Leveraged ETFs have unique risk factors and should only be held for very short periods of time, such as intraday. Or, the losses will be amplified by the same amount.

If the index rises in the short term the ETF returns will be amplified by either 200% or 300%, respectively. The leverage is bullish, meaning they anticipate an upwards move in the index. SPUU is 2x leveraged and SPXL is 3x leveraged.

SPUU & SPXL: Managed by Direxion, these are leveraged S&P 500 ETFs.

SPLG: In response to the lower fees offered by its competitors, State Street issued the SPDR Portfolio S&P 500 ETF (SPLG), which also carries a 0.02% expense ratio.

(These two ETFs could potentially be used for tax-loss harvesting.)

IVV: iShares' S&P 500 ETF is comparable to the Vanguard product, including that 0.03% expense ratio.

Like most of Vanguard's passive index offerings, VOO has a very low 0.03% expense ratio.

VOO: VOO is Vanguard's main S&P 500 ETF.

It comes with a relatively high 0.0945% expense ratio. It is also one of the most active ETFs for options traders.

SPY: The State Street SPDR S&P 500 ETF was the original exchange-traded fund and remains one of the most liquid S&P ETFs.

Dia etf vs sp etf