Dimensional Fund Advisors, a $660 billion global investment manager, converts four more mutual funds into active ETFs, cementing them as a top ETF provider nearly overnight. In an effort to expand investor choice, the Austin, Texas-based manager plans to continue to build out its active ETF offering alongside its mutual funds and separately managed account platform, giving advisors access to time-tested strategies in a tax-efficient package.
The firm’s expanded ETF lineup includes, the Dimensional U.S. Equity ETF (DFUS), the Dimensional U.S. Core Equity 2 ETF (DFAC), the Dimensional U.S. Small Cap ETF (DFAS) and the Dimensional U.S. Targeted Value ETF (DFAT). These U.S. tax-managed strategies, converted from mutual funds to active ETFs, are listed on the New York Stock Exchange and offer investors the ability to manage capital gains and minimize tax impact, while delivering higher after-tax returns.
Dimensional ETFs are transparent active ETFs, which means that advisors use a specific investment strategy to achieve an investment objective, rather than passively tracking an index. This allows for the flexibility to adjust the portfolio’s holdings each day and provides a high level of customization for investors.
Because Dimensional’s strategies position a portfolio to have broader diversification and lower turnover, their design easily lends itself to a higher degree of tax efficiency. Dimensional’s strategy offers the benefits of indexing, including low costs and turnover and high diversification, with flexible implementation, higher expected returns, and attentive risk management. Their strategy aims to accomplish a systematic approach to outperform the market without outguessing it.
Dimensional ETFs offer varied equity solutions including marketwide, core equity portfolios with differing degrees of emphasis on drivers of expected returns. The range of solutions offered provides more flexibility and customization in asset allocation, which assists investors in meeting their specific investment goals.
“For four decades, we have focused on empowering investment professionals so they can deliver their clients the best investment experience. The solutions we are bringing to the ETF marketplace will further that mission, offering more ability to customize and tailor investments to clients’ specific needs and preferences,” says Dimensional Co-CEO Dave Butler.
To learn more, register and watch Dimensional’s webcast: Go Beyond Indexing with ETFs
Join Gerard O’Reilly, Dimensional Fund Advisors’ Co-CEO and Chief Investment Officer, for an overview of innovations in exchange-traded fund (ETF) investing, active transparent ETFs and the evolution of investment vehicles. His presentation will include a discussion of Dimensional’s entry into the ETF space, why the firm has transitioned some mutual funds into ETFs, and how Dimensional believes it can add value by offering investments in an ETF structure.
Topics to be covered include:
- Implementing a systematic, factor-based investment approach inside an active transparent ETF
- Comparing tax efficiencies between mutual funds and ETFs
- Why Dimensional is building out a suite of ETFs as part of its innovation in the space
Mark Gochnour, Dimensional’s Head of the Global Client Services Group, will host the webcast.
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