Dimensional International Sustainability Core 1 ETF (DFSI)

US ETF Dimensional International Sustainability Core 1 ETF: An Overview

Profile:

Dimensional International Sustainability Core 1 ETF (DFIS) is a passively managed exchange-traded fund that invests in developed market companies outside the US with strong environmental, social, and governance (ESG) practices. The ETF tracks the Dimensional International Sustainability Core 1 Index and focuses on value stocks with low relative prices and high cash flows.

Objective:

The primary investment goal of DFIS is to provide long-term capital appreciation through exposure to a diversified portfolio of international ESG-focused companies.

Issuer:

Dimensional Fund Advisors (DFA) is the issuer of DFIS. DFA is a global investment management firm with a long-standing reputation for rigorous research and a disciplined investment approach.

Market Share:

DFIS has a market share of approximately 0.5% in the international ESG ETF space.

Total Net Assets:

As of November 2023, DFIS has approximately $1.5 billion in total net assets.

Moat:

DFIS's competitive advantages include:

• Unique investment approach: DFA's proprietary research and quantitative models identify undervalued stocks with strong ESG profiles.
• Experienced management team: DFA has a seasoned team of investment professionals with extensive expertise in international markets and ESG investing.
• Low fees: DFIS has an expense ratio of 0.25%, making it one of the most cost-effective international ESG ETFs available.

Financial Performance:

DFIS has outperformed its benchmark, the MSCI EAFE ESG Leaders Index, since its inception in 2018. Over the past three years, DFIS has generated an annualized return of 10.5%, compared to 8.2% for the benchmark index.

Growth Trajectory:

The market for international ESG ETFs is expected to grow significantly in the coming years, driven by increasing investor demand for sustainable investment options.

Liquidity:

DFIS has an average daily trading volume of over 100,000 shares, making it a relatively liquid ETF. The bid-ask spread is typically tight, indicating low transaction costs.

Market Dynamics:

Factors affecting DFIS's market environment include:

• Global economic growth: A strong global economy can benefit international stock markets, including DFIS.
• Interest rate policies: Rising interest rates can negatively impact stock markets, including DFIS.
• ESG investing trends: Growing investor demand for ESG investments is a tailwind for DFIS.

Competitors:

Key competitors of DFIS include:

• iShares MSCI EAFE ESG Leaders ETF (ESGV)
• Xtrackers MSCI EAFE ESG Leaders Equity ETF (XESGU)
• SPDR MSCI EAFE ESG Leaders UCITS ETF (ESGU)

Expense Ratio:

DFIS has an expense ratio of 0.25%.

Investment Approach and Strategy:

DFIS tracks the Dimensional International Sustainability Core 1 Index, which selects stocks based on a combination of factors, including:

• Value characteristics: Stocks with low relative prices and high cash flows.
• ESG scores: Companies with strong environmental, social, and governance practices.

Key Points:

• DFIS provides exposure to a globally diversified portfolio of ESG-focused companies.
• The ETF has a strong track record of outperforming its benchmark.
• DFIS has a low expense ratio and is a relatively liquid ETF.

Risks:

• Market risk: DFIS is subject to market fluctuations, which can result in losses.
• Value investing risk: Value stocks can underperform growth stocks, especially during periods of economic expansion.
• ESG investing risk: ESG factors can be complex and difficult to measure, and there is no guarantee that companies with strong ESG scores will outperform.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation through exposure to international ESG-focused companies.
• Investors who are comfortable with the risks associated with value investing and international markets.

Fundamental Rating Based on AI:

Based on an AI-powered analysis of the factors discussed above, DFIS receives a Fundamental Rating of 8 out of 10. This rating is supported by the ETF's strong track record, low fees, experienced management team, and unique investment approach. However, investors should be aware of the risks associated with value investing and international markets.

Resources:

• Dimensional Fund Advisors: https://us.dimensional.com/en-us/individual-investors/etfs/etfs-in-depth/etf-detail?etfSymbol=DFIS
• ETF.com: https://www.etf.com/DFIS
• Morningstar: https://www.morningstar.com/etfs/d/dfis/overview

Disclaimer:

This information is for educational purposes only and should not be considered investment advice. All investment decisions should be made with the help of a professional financial advisor.