The Dow Jones Industrial Average (DJIA) tends to perform better than the S&P 500 and Nasdaq 100 during bear markets. Despite its small sample size of just 30 blue-chip stocks, it has shown resilience by avoiding a full bear market. The SPDR Dow Jones Industrial Average ETF Trust (DIA) offers investors a less risky entry point with higher dividends and lower tech exposure. However, investors should be cautious as the Dow may not be the best choice for downside protection despite its perceived value-rich nature.
The DJIA, with just 30 well-established blue-chip stocks, holds its ground better in bear markets compared to the S&P 500 and Nasdaq 100.
For those hesitant to dive into the stock market, the DIA represents a less volatile option with higher dividends and lower tech exposure.
Despite the Dow being perceived as a value-rich index, caution is advised for those seeking downside protection, as better options exist.
The DJIA has, for now, avoided a bear market dropping around 13% from its peak, outpacing declines in the S&P 500 and Nasdaq.
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