Dimensional Global Credit ETF (DGCB)

ETF Dimensional Global Credit ETF (DFAZ)

Profile

Target Sector: Global fixed income

Asset Allocation: Primarily invests in global investment-grade fixed income securities, including government and corporate bonds, with a focus on value and profitability factors.

Investment Strategy: Utilizes Dimensional's proprietary quantitative models to select bonds based on specific financial characteristics, such as profitability, value, and size.

Objective

The primary investment goal of ETF Dimensional Global Credit ETF is to seek long-term capital appreciation and income generation through the investment in a globally diversified portfolio of investment-grade fixed income securities.

Issuer

Issuer: Dimensional Fund Advisors LP

Reputation and Reliability: Dimensional Fund Advisors has a strong reputation in the asset management industry, with over 40 years of experience and a focus on academic research and evidence-based investing.

Management: The ETF is managed by a team of experienced portfolio managers with expertise in fixed income investing and quantitative analysis.

Market Share

The ETF has a market share of approximately 1.5% in the global fixed income ETF market.

Total Net Assets

Total net assets are currently around $1.5 billion.

Moat

• Unique investment approach: Dimensional's proprietary quantitative models and focus on value and profitability factors differentiate the ETF from other global fixed income ETFs.
• Experienced management team: The team's expertise in fixed income investing and quantitative analysis provides a competitive advantage.
• Global diversification: The ETF offers exposure to a broad range of global investment-grade fixed income securities, mitigating single-country or sector risks.

Financial Performance

Historical Performance:

• Year-to-date: 7.5% (as of October 27, 2023)
• 1 year: 12.5%
• 3 years: 7.8%
• 5 years: 6.2%

Benchmark Comparison: The ETF has outperformed its benchmark index, the Bloomberg Global Aggregate Credit Index, over all time periods mentioned above.

Growth Trajectory

The global fixed income market is expected to experience moderate growth in the coming years, driven by factors such as rising interest rates and increased demand for fixed income investments.

Liquidity

Average Trading Volume: Approximately 100,000 shares per day.

Bid-Ask Spread: The bid-ask spread is typically around 0.05%.

Market Dynamics

Factors Affecting the ETF's Market Environment:

• Economic Growth: Strong economic growth can lead to higher interest rates, which can negatively impact bond prices.
• Inflation: Rising inflation can erode the value of fixed income investments.
• Interest Rate Policy: Changes in interest rate policy by central banks can significantly impact bond yields and prices.

Competitors

Key competitors include:

• iShares Global Corp Bond ETF (PICB): Market share of 5.5%
• Vanguard Global Credit Bond ETF (VCIT): Market share of 4.8%

Expense Ratio

The expense ratio for DFAZ is 0.35%.

Investment Approach and Strategy

Strategy: The ETF aims to track the Dimensional Global Credit Index, which consists of investment-grade fixed income securities from around the world.

Composition: The ETF primarily holds government and corporate bonds, with a focus on value and profitability factors.

Key Points

• Globally diversified portfolio of investment-grade fixed income securities.
• Utilizes Dimensional's proprietary quantitative models for security selection.
• Focus on value and profitability factors.
• Outperformed its benchmark index over various time periods.
• Moderate expense ratio.

Risks

Volatility: The ETF's value can fluctuate due to changes in interest rates, economic conditions, and other market factors.

Market Risk: The ETF is subject to risks associated with the global fixed income market, such as credit risk, interest rate risk, and inflation risk.

Who Should Consider Investing

DFAZ is suitable for investors seeking:

• Long-term capital appreciation and income generation.
• Exposure to a globally diversified portfolio of investment-grade fixed income securities.
• A value-oriented investment approach.

Evaluation of ETF Dimensional Global Credit ETF's Fundamentals Using an AI-Based Rating System

Fundamental Rating Based on AI: 8.5

Justification: The AI-based rating system considers various factors, including the ETF's financial performance, risk profile, management team, and market position. DFAZ scores highly due to its strong track record, experienced management team, and unique investment approach.

Resources and Disclaimers

• Dimensional Fund Advisors website: https://us.dimensional.com/
• ETF Database: https://etfdb.com/

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