Dimensional International Sustainability Core 1 ETF (DFSI)

Overview

The Dimensional International Sustainability Core 1 ETF seeks to provide long-term capital appreciation by investing in a diversified portfolio of international equities that meet specific sustainability criteria. It focuses on companies with strong environmental, social, and governance (ESG) characteristics, aiming for broad market exposure with a tilt towards factors that have historically delivered higher returns.

Reputation and Reliability

Dimensional Fund Advisors (DFA) is a well-established investment management firm known for its systematic, research-driven approach. They have a strong reputation for adhering to academic principles in their investment strategies and are trusted by many financial advisors.

Management Expertise

DFA employs a team of experienced investment professionals with deep expertise in quantitative analysis, portfolio construction, and factor-based investing. Their approach is grounded in decades of academic research and a commitment to disciplined, long-term investment.

Goal

The primary investment goal is to achieve long-term capital appreciation through exposure to a globally diversified portfolio of international stocks that exhibit strong sustainability characteristics and a factor-based investment approach.

Investment Approach and Strategy

Strategy: This ETF aims to provide exposure to international equities that align with sustainability principles. While not tracking a specific benchmark index in a traditional sense, it seeks to capture the returns of sustainable international markets with a focus on factors like value and profitability.

Composition The ETF holds a diversified portfolio of international equities (stocks) across various developed and emerging markets. The selection process incorporates sustainability screens and a factor-based approach to identify companies with favorable characteristics.

Market Share: Market share data for specific ETFs can fluctuate. For the Dimensional International Sustainability Core 1 ETF, its market share within the broader international sustainable ETF space is a component of Dimensional's overall ETF presence.

Total Net Assets (AUM): 2023-11-30: $498,250,757.00

Key Competitors

• iShares MSCI EAFE ESG Optimized ETF (ESGD)
• Vanguard FTSE Developed Markets ETF (VEA)
• iShares Core MSCI EAFE ETF (IEFA)

Competitive Landscape

The international ETF market, particularly those with ESG or sustainability focuses, is highly competitive. Major players like iShares and Vanguard offer broad market exposure with established brand recognition. Dimensional's advantage lies in its research-backed, factor-tilted approach to sustainability, which may appeal to investors seeking a more systematic and potentially higher-returning strategy beyond simple ESG screening. However, it faces challenges in matching the sheer scale and brand awareness of some larger competitors.

Historical Performance: As of 2023-11-30: 1-Year: 10.17% 3-Year: 4.98% 5-Year: 7.32% 10-Year: 7.11%

Benchmark Comparison: The ETF's performance is not tied to a single traditional index. However, it aims to outperform broader international equity benchmarks over the long term through its factor-tilted sustainability approach.

Expense Ratio: 0.30%

Average Trading Volume

The average daily trading volume for the Dimensional International Sustainability Core 1 ETF is generally moderate, indicating reasonable liquidity for most investors.

Bid-Ask Spread

The bid-ask spread is typically tight, reflecting efficient trading and lower transaction costs for investors.

Market Environment Factors

Factors such as global economic growth, interest rate policies in major economies, geopolitical events, and evolving investor preferences for sustainable investments significantly influence the ETF's performance. Sector-specific trends within international markets also play a crucial role.

Growth Trajectory

The ETF's growth trajectory is tied to the increasing demand for sustainable investments and Dimensional's ability to effectively implement its factor-based investment philosophy within the international equity universe. Changes in its holdings would reflect its ongoing commitment to sustainability and factor exposure.

Competitive Edge

Dimensional's core competitive advantage lies in its deeply rooted academic research and systematic, factor-based investment philosophy. This approach seeks to enhance returns by focusing on dimensions of expected returns beyond broad market beta. The integration of sustainability criteria within this proven framework offers a unique value proposition for investors looking for both ethical considerations and robust financial performance. Their disciplined rebalancing and diversification further strengthen their position.

Volatility

The ETF exhibits moderate historical volatility, consistent with diversified international equity portfolios. Its factor tilts may introduce some specific volatility characteristics.

Market Risk

The ETF is subject to market risk associated with international equities, including currency fluctuations, political instability in foreign countries, economic downturns, and changes in regulatory environments. Specific sustainability risks for individual companies also contribute to overall risk.

Ideal Investor Profile

The ideal investor for the Dimensional International Sustainability Core 1 ETF is one who seeks long-term capital appreciation, has a global investment outlook, and prioritizes investments that align with environmental, social, and governance principles. Investors who believe in factor-based investing and understand the potential benefits of a systematic, research-driven approach would also be well-suited.

Market Risk

This ETF is best suited for long-term investors who are looking for a diversified portfolio of international equities with a sustainability focus and a systematic investment methodology. It is not designed for short-term trading.

The Dimensional International Sustainability Core 1 ETF offers a research-driven approach to sustainable international investing, combining factor-based strategies with ESG considerations. It aims for long-term capital appreciation through a diversified portfolio of global equities. While facing competition from larger players, its unique methodology provides a distinct advantage. The ETF is best suited for long-term investors seeking a blend of ethical investing and systematic return enhancement.

Data Sources:

• Dimensional Fund Advisors Official Website
• Financial Data Aggregators (e.g., Morningstar, ETF.com)

Disclaimers:

This information is for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Investors should consult with a qualified financial advisor before making any investment decisions.