Business and Personal Finance Dictionary

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• DIAMONDS
  
  A DIAMOND is an index-based unit investment trust (UIT) that holds the 30 stocks in the Dow Jones Industrial Average (DJIA). It's similar in structure to an exchange traded mutual fund (ETF). Investors buy shares, or units, of the trust, which is listed on the American Stock Exchange (AMEX) as DIA. The share price changes throughout the day as investors buy and sell, just as share prices of stocks do. That's in contrast to open-end mutual funds whose share prices change just once a day, when trading in their underlying investments ends for the day. Part of the appeal of DIAMOND shares, like the appeal of Standard & Poor's Depositary Receipts (SPDRs) and other ETFs, is that the trust mirrors the performance of its benchmark index for dramatically less than the cost of buying shares in all 30 stocks in the DJIA. A DIAMOND share trades at about 1/100 the value of the DJIA. So, for example, if the DJIA is at 10,600, shares in the trust will be priced around $106.
  
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