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ETFs to Bet on Dow Jones' Longest Winning Streak of 2024
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The Dow Jones Industrial Average emerged relatively unscathed from the latest Fed official comments that higher rates will likely stay for some time. The blue-chip index gained for six consecutive days, marking its longest winning streak this year and emerging more powerful than the other two major indices, which cooled down in the latest session as Treasury yields rose. Notably, the index closed above 39,000 for the first time in five weeks.
Investors seeking to participate in the Dow Jones rally can consider SPDR Dow Jones Industrial Average ETF (DIA - Free Report) , iShares Dow Jones U.S. ETF (IYY - Free Report) , Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report) , ProShares Ultra Dow30 ETF (DDM - Free Report) and ProShares UltraPro Dow30 (UDOW - Free Report) .
Fed officials reaffirmed the stance for higher rates for a longer period. Policymaker Neel Kashkari signaled that rates are likely to stay at historic highs for a while. Boston Fed President Susan Collins further supported this notion, saying it will take longer "than previously thought" to bring inflation down. Per the latest CME’s FedWatch Tool, markets are pricing in a first quarter-point cut in September, with traders seeing 71% odds of two rate cuts by the end of 2024.
However, the latest market rally is primarily driven by solid corporate earnings and stock buybacks. U.S. companies are having their best earnings season in nearly two years. With 80% of the companies in the S&P 500 having already reported, the index is on track to record 5% growth in first-quarter earnings per share per FactSet. This is the biggest year-over-year increase since the second quarter of 2022 and higher than the 3.2% growth analysts had expected prior to the start of the season (read: Time to Tap Wall Street ETFs on Earnings Strength?).
Meanwhile, stock buybacks recently staged a strong comeback from the lull witnessed in 2023. Companies have announced share repurchases of more than $383 billion in the last 13 weeks, up 30% from the year-ago period and the highest since June 2018, per research from Deutsche Bank. This indicates that corporate America is bullish on the U.S. economy.
Additionally, Dow Jones’ longest win streak came on the back of a broadened rally beyond the tech sector. Cyclical stocks, bank stocks and small-cap stocks have all shown an upward trend in recent sessions, powering the blue-chip index.
ETFs to Bet
SPDR Dow Jones Industrial Average ETF (DIA - Free Report)
SPDR Dow Jones Industrial Average ETF is one of the largest and most popular ETFs in the large-cap space, with an AUM of $32.6 billion and an average daily volume of 4 million shares. Holding 30 blue-chip stocks, the fund is widely spread across components, with each having less than 8.5% share. Financials (23%), information technology (18.8%), healthcare (18.2%), consumer discretionary (15%) and industrials (13.7%) are the top five sectors.
iShares Dow Jones U.S. ETF tracks the Dow Jones U.S. Index, holding 1074 stocks in its basket, with none accounting for more than 6.3% of the assets. Information technology takes the largest share at 28.7%, while financials, healthcare and consumer discretionary round off the next spots with double-digit exposure each.
iShares Dow Jones U.S. ETF has amassed $1.9 million in its asset base while trading in an average daily volume of 27,000 shares. It charges 20 bps in annual fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report)
Invesco Dow Jones Industrial Average Dividend ETF offers exposure to dividend-paying companies included in the Dow Jones Industrial Average by their 12-month dividend yield over the prior 12 months. It holds 29 stocks in its basket, with none accounting for more than 10% of the assets.
Invesco Dow Jones Industrial Average Dividend ETF has been able to manage assets worth $295.1 million while trading in a volume of 21,000 shares a day on average. It charges 7 bps in annual fees and has a Zacks ETF Rank #3.
Leveraged Play: A Short-Term Win
Investors willing to take an extra risk could go for leveraged ETFs. These funds create a leveraged (2X or 3X) long position in the underlying index through the use of swaps, options, future contracts and other financial instruments. While these funds provide outsized returns in a short span, they could lead to huge losses compared to traditional funds in fluctuating or seesaw markets.
ProShares Ultra Dow30 ETF provides twice (2X) the return of the Dow Jones Industrial Average. It has AUM of $400.4 million and trades in a good volume of around 344,000 shares on average. The product charges 95 bps in annual fees (see: all the Leveraged Equity ETFs here).
ProShares UltraPro Dow30 also tracks the Dow Jones Industrial Average but offers three times (3X) exposure to the index. It has amassed $597.6 million in its asset base and trades in a solid average daily volume of 3 million shares. The expense ratio comes in at 0.95%.
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ETFs to Bet on Dow Jones' Longest Winning Streak of 2024
The Dow Jones Industrial Average emerged relatively unscathed from the latest Fed official comments that higher rates will likely stay for some time. The blue-chip index gained for six consecutive days, marking its longest winning streak this year and emerging more powerful than the other two major indices, which cooled down in the latest session as Treasury yields rose. Notably, the index closed above 39,000 for the first time in five weeks.
Investors seeking to participate in the Dow Jones rally can consider SPDR Dow Jones Industrial Average ETF (DIA - Free Report) , iShares Dow Jones U.S. ETF (IYY - Free Report) , Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report) , ProShares Ultra Dow30 ETF (DDM - Free Report) and ProShares UltraPro Dow30 (UDOW - Free Report) .
Fed officials reaffirmed the stance for higher rates for a longer period. Policymaker Neel Kashkari signaled that rates are likely to stay at historic highs for a while. Boston Fed President Susan Collins further supported this notion, saying it will take longer "than previously thought" to bring inflation down. Per the latest CME’s FedWatch Tool, markets are pricing in a first quarter-point cut in September, with traders seeing 71% odds of two rate cuts by the end of 2024.
However, the latest market rally is primarily driven by solid corporate earnings and stock buybacks. U.S. companies are having their best earnings season in nearly two years. With 80% of the companies in the S&P 500 having already reported, the index is on track to record 5% growth in first-quarter earnings per share per FactSet. This is the biggest year-over-year increase since the second quarter of 2022 and higher than the 3.2% growth analysts had expected prior to the start of the season (read: Time to Tap Wall Street ETFs on Earnings Strength?).
Meanwhile, stock buybacks recently staged a strong comeback from the lull witnessed in 2023. Companies have announced share repurchases of more than $383 billion in the last 13 weeks, up 30% from the year-ago period and the highest since June 2018, per research from Deutsche Bank. This indicates that corporate America is bullish on the U.S. economy.
Additionally, Dow Jones’ longest win streak came on the back of a broadened rally beyond the tech sector. Cyclical stocks, bank stocks and small-cap stocks have all shown an upward trend in recent sessions, powering the blue-chip index.
ETFs to Bet
SPDR Dow Jones Industrial Average ETF (DIA - Free Report)
SPDR Dow Jones Industrial Average ETF is one of the largest and most popular ETFs in the large-cap space, with an AUM of $32.6 billion and an average daily volume of 4 million shares. Holding 30 blue-chip stocks, the fund is widely spread across components, with each having less than 8.5% share. Financials (23%), information technology (18.8%), healthcare (18.2%), consumer discretionary (15%) and industrials (13.7%) are the top five sectors.
SPDR Dow Jones Industrial Average ETF charges 16 bps in annual fees and has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk (read: 4 ETF Areas to Play Amid Slower Growth & Rising Inflation).
iShares Dow Jones U.S. ETF (IYY - Free Report)
iShares Dow Jones U.S. ETF tracks the Dow Jones U.S. Index, holding 1074 stocks in its basket, with none accounting for more than 6.3% of the assets. Information technology takes the largest share at 28.7%, while financials, healthcare and consumer discretionary round off the next spots with double-digit exposure each.
iShares Dow Jones U.S. ETF has amassed $1.9 million in its asset base while trading in an average daily volume of 27,000 shares. It charges 20 bps in annual fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report)
Invesco Dow Jones Industrial Average Dividend ETF offers exposure to dividend-paying companies included in the Dow Jones Industrial Average by their 12-month dividend yield over the prior 12 months. It holds 29 stocks in its basket, with none accounting for more than 10% of the assets.
Invesco Dow Jones Industrial Average Dividend ETF has been able to manage assets worth $295.1 million while trading in a volume of 21,000 shares a day on average. It charges 7 bps in annual fees and has a Zacks ETF Rank #3.
Leveraged Play: A Short-Term Win
Investors willing to take an extra risk could go for leveraged ETFs. These funds create a leveraged (2X or 3X) long position in the underlying index through the use of swaps, options, future contracts and other financial instruments. While these funds provide outsized returns in a short span, they could lead to huge losses compared to traditional funds in fluctuating or seesaw markets.
ProShares Ultra Dow30 ETF (DDM - Free Report)
ProShares Ultra Dow30 ETF provides twice (2X) the return of the Dow Jones Industrial Average. It has AUM of $400.4 million and trades in a good volume of around 344,000 shares on average. The product charges 95 bps in annual fees (see: all the Leveraged Equity ETFs here).
ProShares UltraPro Dow30 (UDOW - Free Report)
ProShares UltraPro Dow30 also tracks the Dow Jones Industrial Average but offers three times (3X) exposure to the index. It has amassed $597.6 million in its asset base and trades in a solid average daily volume of 3 million shares. The expense ratio comes in at 0.95%.