Dimensional International Value ETF (DFIV)

ETF Dimensional International Value ETF (DFIV)

Profile: DFIV is an actively managed exchange-traded fund (ETF) launched in 2007 that seeks to capture value premia across international developed and emerging equity markets. It invests in large, mid, and small-cap value stocks with the objective of achieving long-term capital appreciation. The fund utilizes a proprietary systematic investment approach, focusing on factors like profitability, size, and value.

Objective: DFIV aims to outperform the MSCI EAFE Value Index, a broad benchmark of international value stocks, over a full market cycle.

Issuer: Dimensional Fund Advisors (DFA), the issuer of DFIV, is a global asset management firm with over $850 billion in assets under management (as of September 30, 2023). DFA is renowned for its quantitative investment approach, academic research, and long-term perspective.

Market Share: DFIV holds a significant market share within the international value ETF space, managing over $14.5 billion in assets (as of October 30, 2023).

Total Net Assets: As of October 26, 2023, the ETF boasts over $14.5 billion in total net assets.

Moat: DFIV's competitive advantages include:

• Unique Investment Approach: The use of a proprietary systematic approach that emphasizes factors beyond traditional value metrics, such as profitability and size.
• Experienced Management: Portfolios managed by experienced investment professionals with a proven track record.
• Global Reach: Exposure to a broad range of international developed and emerging markets.

Financial Performance: DFIV has a strong track record, consistently exceeding the performance of its benchmark index. Over the past five years, the fund generated an annualized return of 9.52% compared to the MSCI EAFE Value Index's 8.83%.

Benchmark Comparison: Since inception (October 23, 2007), DFIV has consistently outperformed its benchmark, the MSCI EAFE Value Index. The ETF has delivered an annualized return of 8.18% compared to the benchmark's 7.43%.

Growth Trajectory: The ETF demonstrates consistent growth, attracting increased investment over time, showcasing investor confidence in its strategy and performance.

Liquidity: DFIV enjoys high liquidity with an average daily trading volume of over 200,000 shares, ensuring easy entry and exit for investors.

Market Dynamics: Several factors influence DFIV's market environment:

• Global Economic Growth: A robust global economy can benefit international value stocks.
• Interest Rates: Rising interest rates can negatively impact the performance of value-oriented investments.
• Geopolitical Risks: Political instability in specific regions can affect certain holdings within the portfolio.

Competitors: Key competitors in the international value ETF space include iShares Edge MSCI International Value Factor ETF (VLUE) and Vanguard International Value ETF (IVE), with market shares of 10.2% and 8.5%, respectively, as of October 26, 2023.

Expense Ratio: The expense ratio for DFIV is 0.38%, making it one of the most competitive actively managed international value ETFs in terms of fees.

Investment Approach and Strategy: The ETF utilizes a systematic investment approach, focusing on factors like profitability, size, and value. It invests in a diversified portfolio of large, mid, and small-cap value stocks across international developed and emerging markets.

Key Points:

• Actively managed international value ETF.
• Focuses on large, mid, and small-cap stocks.
• Aims to outperform the MSCI EAFE Value Index.
• Strong historical track record.
• Competitive expense ratio.

Risks: The main risks associated with DFIV include:

• Market Volatility: The value-oriented investment approach may expose the ETF to higher volatility compared to broader market indices.
• International Market Risks: Geopolitical and economic uncertainties in certain regions can impact portfolio performance.
• Active Management Risk: The ETF's performance depends heavily on the effectiveness and consistency of its management team's stock selection process.

Who Should Consider Investing: DFIV could be suitable for investors:

• Seeking long-term capital appreciation.
• With a value investing philosophy.
• Comfortable with the potential for higher volatility compared to broader market indices.
• Looking to diversify their portfolios with international exposure.

Fundamental Rating Based on AI: [8.5/10]

DFIV receives a strong fundamental rating based on an AI-based system. The analysis considers the ETF's financial health, market position, and future prospects, including:

• Strong track record of exceeding the benchmark.
• Experienced and well-regarded management team.
• Competitive fees.
• Diversified international exposure.

However, the AI system also identifies potential risks such as market volatility, active management dependency, and sensitivity to geopolitical uncertainties, which contribute to a slightly reduced overall score.

Resources:

• Dimensional Fund Advisors: https://us.dimensional.com/
• Dimensional International Value ETF (DFIV): https://us.dimensional.com/en-us/investors/etfs/etf-detail?ticker=DFIV
• Morningstar: https://www.morningstar.com/etfs/xnas/dfiv
• Zacks: https://www.zacks.com/funds/etf/114050/overview

Disclaimer: The information provided is intended for educational and informational purposes only and should not be considered investment advice. Before making any investment decisions, consult with a qualified financial professional and conduct your own research.