Dimensional launches two new multi-factor ETFs

Dec 8th, 2022 | By | Category: ETF and Index News

Dimensional Fund Advisors has launched two new fully transparent active ETFs that systematically harvest multiple factor risk premia within US large-cap value and global real estate markets.

Gerard O’Reilly, co-CEO and Chief Investment Officer, Dimensional Fund Advisors

Gerard O’Reilly, co-CEO and CIO of Dimensional Fund Advisors

The Dimensional US Large Cap Value ETF (DFLV US) and Dimensional Global Real Estate ETF (DFGR US) have been listed on NYSE Arca with expense ratios of 0.22% and 0.24%, respectively.

Driven by clearly defined quantitative rules, Dimensional’s multi-factor approach employs modest portfolio tilts away from conventional market cap weights based on targeted factor exposures. Each ETF is designed to emphasize long-term drivers of expected returns while balancing risk through broad diversification.

Commenting on the new listings, Gerard O’Reilly, co-CEO and CIO of Dimensional Fund Advisors, said: “Dimensional has been investing in both large-cap value and real estate securities for three decades, providing capital markets expertise that we have now made available within ETFs. These new funds allow financial professionals to deliver an increasingly comprehensive Dimensional investment experience across vehicles and asset classes.”

Dave Butler, co-CEO of Dimensional Fund Advisors, added: “For over four decades, Dimensional has been an industry leader in thoughtful research and meticulous implementation of the great ideas in financial science. Dimensional remains committed to continuously enhancing our offerings and bringing new ETFs to market that add value for clients.”

The Dimensional US Large Cap Value ETF begins with a universe of US large-cap stocks with value characteristics (based primarily on price to book value). The fund delivers broad exposure to this universe while tilting weights in favour of smaller companies with value and profitability (based on earnings to book value or profits to book value) characteristics.

The Dimensional Global Real Estate ETF, meanwhile, invests in real estate investment trusts (REITs) and real estate operating companies of any market capitalization that are listed in either developed or emerging markets. Constituents are generally weighted by market capitalization but may be tilted to enhance exposure to low-size, value, profitability, liquidity, and momentum factors.

The two new listings expand Dimensional’s ETF roster to 30 funds which collectively house over $70 billion in assets under management, making the firm the largest provider of actively managed ETFs globally.

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