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Dimensional Fund Advisors

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Dimensional Fund Advisors
Company typePrivate
IndustryFinance
Founded1981; 43 years ago (1981)
FoundersDavid G. Booth
Rex Sinquefield
HeadquartersAustin, Texas, United States
Key people
David G. Booth
(Executive Chairman)
Dave Butler
(Co-CEO)
Gerard K. O'Reilly
(Co-CEO)
ProductsMoney Management and Investment
AUMIncrease $794 billion (Sept 30, 2024)[1]
Number of employees
1,500+ (2024)[2]
Websitewww.dimensional.com

Dimensional Fund Advisors, L.P. (branded Dimensional abbreviated DFA[3]) is a privately-owned investment firm headquartered in Austin, Texas. Dimensional was founded in Brooklyn[4] in 1981 by David Booth, Rex Sinquefield and Larry Klotz. The company has 15 international offices in the U.S., Canada, U.K., Germany, Netherlands, Australia, Singapore, and Japan.[5] Dimensional maintains additional U.S. offices in Charlotte, North Carolina and Santa Monica, California.

The company’s founders studied at the University of Chicago under Eugene Fama. Kenneth French is co-chair of the firm's investment research committee.[6] DFA's investment strategy is based on application of the efficient market hypothesis.[7] Dimensional was one of the earliest firms to offer passive investing and "runs the oldest small-cap index fund" in the United States.[8] However, the firm's versions of index funds have the flexibility to trade daily[9] and skew towards smaller company stocks and value stocks; They operate differently from most index funds which rebalance on specific dates and are weighted by market capitalization.[10] This strategy results in regulators, such as the SEC,[11] and some analysts[12][13][14] describing the funds as actively managed. The company offers equity and fixed income mutual funds, Exchange-traded funds, separately managed accounts, and model portfolios.

In 2009, Dimensional acquired SmartNest, a retirement planning computer software company.[15] Researcher Robert C. Merton left SmartNest's board after the purchase and became a Resident Scientist at Dimensional.[16][17][18]

In November 2020, the firm announced it was augmenting its strictly advisor-access[19] and institutional[20] only mutual fund business model by offering openly-accessed exchange-traded funds.[21][22][23][24]

Board of Directors

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Board of Directors of the general partner of Dimensional Fund Advisors LP: [25]

  • David Booth
  • Eugene Fama
  • Kenneth French
  • John "Mac" McQuown
  • Gerard K. O'Reilly
  • Dave Butler

Board of Directors, Dimensional Mutual Funds and ETFs, US:[26]

References

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  1. ^ "Dimensional Investing". Retrieved 2024-10-22.
  2. ^ "Dimensional: About Us".
  3. ^ "FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES: DFA INVESTMENT DIMENSIONS GROUP INC". sec.gov. Retrieved 20 March 2021.
  4. ^ "David Booth: Biography".
  5. ^ "Dimensional: About Us".
  6. ^ "Kenneth French: Bio".
  7. ^ "Dimensional Investing | Dimensional Fund Advisors". Dimensional. Retrieved 2018-11-09.
  8. ^ William J. Bernstein (2002). The Four Pillars of Investing: Lessons for Building a Winning Portfolio. McGraw-Hill, ISBN 0071385290, p. 103
  9. ^ "Dimensional Fund Advisors Lists Active Exchange-Traded Funds".
  10. ^ John Rekenthaler (Nov 25, 2020) DFA Is Paying the Price for Its Conviction. Morningstar.com, accessed 19 March 2021
  11. ^ "Registration statement - DIMENSIONAL ETF TRUST". SECURITIES AND EXCHANGE COMMISSION. 16 November 2020.
  12. ^ "DFAU ETF Report". etf.com. Retrieved 20 March 2021.
  13. ^ Liu, Evie (18 November 2020). "Another Fund Manager Enters the World of Exchange-Traded Funds. What's Behind the Trend". Barrons.
  14. ^ Lydon, Tom (December 28, 2020). "The ETF-Mutual Fund Tide is Turning: DFAI and DFAU Switching Sides".
  15. ^ Inklebarger, Timothy (2009-12-02). "Dimensional adds retirement planning software firm". Pensions & Investments. Retrieved 2013-05-12.
  16. ^ "Curriculum Vitae". www.robertcmerton.com. Robert C Merton. Retrieved 2021-01-20.
  17. ^ "Robert Merton". Becker Friedman Institute.
  18. ^ "Next Generation Retirement Planning" (PDF).
  19. ^ "Work With Us: Financial Advisors".
  20. ^ "Work With Us: Institutions".
  21. ^ "Why Dimensional Fund Advisors is converting six of its mutual funds to the ETF format". CNBC. December 2020. Retrieved 24 February 2021.
  22. ^ "DFA Takes The Stage With ETFs". etf.com. Retrieved 24 February 2021.
  23. ^ "Dimensional Fund ETFs Launch as Quant Plans to Convert Mutual Funds". Bloomberg News. 18 November 2020. Retrieved 24 February 2021.
  24. ^ Johnson, Steve (23 November 2020). "Mutual fund conversions to ETFs set to gather momentum, experts say". Financial Times.
  25. ^ "About Us".
  26. ^ "About Us".
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