5-Year Backtest: Buy and Hold DIA (SPDR Dow Jones Industrial Average ETF Trust)

This analysis evaluates a buy-and-hold strategy over the past 5 years, providing a historical perspective on DIA's performance from 2020-07-06 to 2025-07-03.

Note: This simulation uses adjusted close prices, meaning all historical prices have been retroactively adjusted for splits and dividends. To achieve similar results in practice, you would need to reinvest all dividends automatically as they are paid.

Performance Overview

Starting with an initial capital of $10,000.00, we purchased shares of DIA on 2020-07-06, at a price of $240.20 per share (adjusted for splits and dividends). No trading, no adjustments — just a simple buy-and-hold approach.

We held the position continuously through every market twist and turn, never selling. As of 2025-07-03, the price of DIA had risen to $448.09. While we didn't sell, we can still assess the performance by calculating the current value of the investment: $18,654.92 — a total gain of 86.55%.

This translates into an annualized return of 13.31% over the entire period. This return is moderately above long-term averages. It reflects solid long-term performance and an effective strategy.

Drawdown and Risk

The maximum drawdown recorded during this period was 20.76%. This drawdown began after a peak price of $345.07 on 2022-01-04, and reached its lowest point on 2022-09-30 when the price fell to $273.44. The drawdown lasted for 269 days.

The drawdown was relatively small, suggesting the asset or strategy maintained reasonable stability through market fluctuations. The maximum drawdown lasted over six months, suggesting a sustained downturn or persistent volatility. These periods can shake investor confidence and demand discipline.

The Calmar Ratio — annualized return divided by maximum drawdown — was 0.64, reflecting the tradeoff between return and volatility.

A strong ratio that reflects a healthy balance between return and drawdown. This level is above average for most equity-based strategies.