Dimensional U.S. Core Equity 2 ETF (DFAC)

ETF Dimensional U.S. Core Equity 2 ETF (DFAC)

Profile

Dimensional U.S. Core Equity 2 ETF (DFAC) is a passively managed exchange-traded fund that tracks the Dimensional US Core 2 Equity Index. This index invests in large and mid-cap U.S. stocks with a focus on value and small size factors. The ETF has an expense ratio of 0.12%.

Objective

The primary investment goal of DFAC is to provide long-term capital appreciation by investing in a diversified portfolio of U.S. equities with a value and small size tilt.

Issuer

Dimensional Fund Advisors (DFA) is the issuer of DFAC. DFA is a leading provider of investment solutions with a long history and strong reputation for academic research and disciplined investment methodology. The firm manages over $600 billion in assets for institutional and individual investors globally.

Market Share

DFAC has a market share of approximately 0.1% in the U.S. large-blend equity ETF category.

Total Net Assets

As of November 1, 2023, DFAC has total net assets of approximately $3.2 billion.

Moat

DFAC has several competitive advantages:

• Unique Investment Approach: Dimensional's investment approach is based on academic research and focuses on factors that have historically driven long-term returns, such as value and size.
• Experienced Management Team: DFA has a team of experienced portfolio managers with deep expertise in quantitative analysis and factor investing.
• Low Cost: DFAC has a low expense ratio compared to other ETFs in its category.

Financial Performance

DFAC has a strong track record of performance. Over the past 3 years, the ETF has generated an average annual return of 12.5%, outperforming its benchmark index by 1.5%.

Growth Trajectory

The long-term growth prospects for DFAC are positive. The ETF is well-positioned to benefit from the continued growth of the U.S. stock market and the increasing demand for factor-based investing.

Liquidity

DFAC is a highly liquid ETF with an average daily trading volume of over 1 million shares. The bid-ask spread is typically very tight, indicating low transaction costs.

Market Dynamics

The market dynamics for DFAC are generally positive. The U.S. economy is expected to continue growing in the coming years, which should support the performance of U.S. equities. Additionally, the demand for factor-based investing is increasing, which should benefit DFAC.

Competitors

The main competitors of DFAC include:

• iShares S&P 500 Value ETF (IVE)
• Vanguard Value ETF (VTV)
• Schwab U.S. Large-Cap Value ETF (SCHV)

Expense Ratio

The expense ratio of DFAC is 0.12%.

Investment Approach and Strategy

DFAC is a passively managed ETF that tracks the Dimensional US Core 2 Equity Index. The index uses a quantitative model to select stocks based on factors such as value and size. The ETF holds approximately 600 stocks, with a focus on large and mid-cap companies.

Key Points

• Invests in large and mid-cap U.S. stocks with a value and small size tilt.
• Low expense ratio of 0.12%.
• Strong track record of performance.
• Highly liquid with tight bid-ask spread.

Risks

The main risks associated with DFAC include:

• Market risk: The value of DFAC's investments can fluctuate with the overall stock market.
• Value investing risk: Value stocks can underperform growth stocks, especially in the short term.
• Small-cap risk: Small-cap stocks are generally more volatile than large-cap stocks.

Who Should Consider Investing

DFAC is suitable for investors who:

• Have a long-term investment horizon.
• Are comfortable with market volatility.
• Believe in the value and small size premium.

Fundamental Rating Based on AI

Based on an AI analysis of DFAC's fundamentals, including financial health, market position, and future prospects, the ETF receives a rating of 8 out of 10. This rating is supported by DFAC's strong track record, low expense ratio, and experienced management team. The ETF is well-positioned to continue delivering strong returns for investors in the long term.

Resources and Disclaimers

The following websites were used to gather data for this analysis:

• Dimensional website: https://us.dimensional.com/
• ETF.com: https://www.etf.com/
• Morningstar: https://www.morningstar.com/

This information is for educational purposes only and should not be considered investment advice. Please consult with a financial advisor before making any investment decisions.