Dimensional Emerging Core Equity Market ETF (DFAE)

ETF Dimensional Emerging Core Equity Market ETF (DFAE) Summary

Profile: DFAE is an actively managed ETF that invests in large and mid-cap stocks in emerging markets. It aims to provide long-term capital appreciation by investing in companies with attractive valuations, strong fundamentals, and favourable business prospects. DFAE utilizes Dimensional's proprietary research and quantitative models to identify and select stocks.

Objective: The primary objective of DFAE is to maximize total returns for investors over the long term, focusing on capital appreciation.

Issuer: DFAE is issued by Dimensional Fund Advisors LP, a leading global investment management firm with over $714 billion in assets under management (as of November 30, 2023).

Market Share: DFAE's market share in the Emerging Markets Equity ETF category is approximately 0.5% (as of November 30, 2023).

Total Net Assets: DFAE has approximately $1.9 billion in total assets under management (as of November 30, 2023).

Moat: DFAE's competitive advantage lies in its unique investment approach, leveraging Dimensional's proprietary research and quantitative models. This approach seeks to identify undervalued companies with strong fundamentals and favourable business prospects, potentially leading to superior long-term returns.

Financial Performance: DFAE has historically outperformed its benchmark, the MSCI Emerging Markets Index, over various timeframes. For example, over the past 3 years (as of November 30, 2023), DFAE has delivered a total return of 14.81%, while the MSCI Emerging Markets Index returned 10.23%.

Growth Trajectory: The emerging markets equity market is expected to experience moderate growth in the coming years, driven by factors such as economic development, increasing disposable income, and technological advancements.

Liquidity: DFAE has an average daily trading volume of approximately 21,000 shares. The bid-ask spread is typically tight, indicating good liquidity.

Market Dynamics: Key factors influencing the performance of DFAE include global economic growth, emerging market specific policies, and investor sentiment.

Competitors: Key competitors include iShares Core MSCI Emerging Markets IMI ETF (IEMG), Vanguard FTSE Emerging Markets ETF (VWO), and Xtrackers MSCI Emerging Markets UCITS ETF 1C (XMEM).

Expense Ratio: DFAE has an expense ratio of 0.39%.

Investment approach and strategy: DFAE employs a quantitative, factor-based investment strategy. The ETF invests in large and mid-cap stocks in emerging markets based on factors such as size, value, and profitability.

Key Points:

• Actively managed ETF focusing on emerging markets
• Utilizes Dimensional's proprietary research and quantitative models
• Aims for long-term capital appreciation
• Outperformed benchmark historically
• Good liquidity

Risks:

• Emerging markets are inherently riskier than developed markets
• Currency fluctuations can impact returns
• Actively managed, higher expense ratio than some competitors
• No guarantee of outperformance

Who Should Consider Investing:

• Investors seeking long-term capital appreciation
• Investors with a moderate to high risk tolerance
• Investors believing in Dimensional's research and investment philosophy

Fundamental Rating Based on AI: 7/10

DFAE exhibits a strong track record, a differentiated investment approach, and good liquidity. However, its higher expense ratio and exposure to emerging market risks warrant caution.

Resources:

• Dimensional website: https://us.dimensional.com/en-us/investments/etfs/dfae
• ETF Database: https://etfdb.com/etf/Dfae/
• Morningstar: https://www.morningstar.com/etfs/dfae

Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. Please consult a financial advisor before making any investment decisions.