How can the performance of DIAMONDS diverge from the underlying DJIA?
Because the DJIA is not an investment instrument, it incurs no expenses, and they are not reflected in the index value. The net asset value of the DIAMONDS portfolio reflects expenses of the DIAMONDS Trust and includes accrued dividends. The DJIA does not take accrued dividends into account. Also, over time, DIAMONDS may be rebalanced to reflect changes in the index and to ensure proper security weightings as the prices of underlying stocks change. The resulting transaction costs are incurred by the DIAMONDS portfolio but not the DJIA.
