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  • Dimensional

    DIMENSIONAL AT A GLANCE

    One

    INVESTMENT
    PHILOSOPHY

    14

    GLOBAL
    OFFICES

    42

    YEARS SINCE
    FOUNDING

    $618B

    FIRMWIDE ASSETS
    UNDER MANAGEMENT

    A belief in the power of markets

    ALL
    AVAILABLE
    INFORMATION

    $675.8B

    World Equity
    Trading in 2022
    (Daily Average)2

    PRICE

    Each day, the global financial markets process millions of trades between buyers and sellers.

    These trades embed vast amounts of news, expectations, and information into prices.

    Dimensional regards a security’s price as the best estimate of actual value—and bases its investment approach on market prices.

    Focusing on the drivers of returns

    Long-term
    drivers of

    STOCK
    RETURNS3

    COMPANY SIZE

    Small vs. large companies

    RELATIVE PRICE

    Value vs. growth companies

    PROFITABILITY

    High vs. low profitability companies

    Long-term
    drivers of

    BOND
    RETURNS

    TERM

    Sensitivity to interest rates

    CREDIT

    Credit quality of issuer

    CURRENCY

    Currency of issuance

    Dimensional believes security prices contain reliable information about expected returns.

    The firm draws insights from research and prices to emphasize market areas—or dimensions—that drive returns.

    Equity dimensions with higher expected returns are small, value, and high profitability companies. Fixed income dimensions are term, credit, and currency.

    Dimensional targets these dimensions in low-cost, broadly diversified strategies.4

    A different investment approach

    Index fund managersaim to match index returns, accepting portfolio management and trading constraints that can increase costs.

    Traditional managers and quants may rely on predictions or backtested simulations to find mispriced securities or to time markets.

    Dimensional believes investors can have a successful investment experience without having to outguess the market. The firm trusts market prices and applies a scientific, transparent, and processdriven investment approach to pursue higher expected returns

    Applying financial science to investing

    Dimensional has forged deep working relationships with top academics in finance.

    Nobel laureate Eugene Fama, fellow researcher Kenneth French, and other leading academics are directors and consultants to the firm.

    A scientific perspective guides the firm’s culture, philosophy, and investment approach.

    “The research is out there for anybody to access. What distinguishes Dimensional is the way we implement the ideas.”

    —David Booth

    Value-added implementation

    Expert implementation sets Dimensional apart. The firm applies financial science in real-world portfolios through a process that integrates:

    RESEARCH Gain a better understanding of expected returns by evaluating and testing empirical research

    PORTFOLIO DESIGN Increase expected returns while allowing for robust risk and cost management

    PORTFOLIO MANAGEMENT Use current market information to balance tradeoffs between competing premiums and costs

    TRADING Reduce trading costs by employing a flexible approach to participate in available market liquidity

    1. Firmwide assets under management as of June 30, 2023, in USD (billions).
    2. In USD. Source: Dimensional, using data from Bloomberg LP. Includes primary and secondary exchange trading volume globally for equities. ETFs and funds are excluded. Daily averages were computed by calculating the trading volume of each stock daily as the closing price multiplied by shares traded that day. All such trading volume is summed up and divided by 252 as an approximate number of annual trading days.
    3. Relative price is measured by the price-to-book ratio; value stocks are those with lower price-to-book ratios. Profitability is measured as operating income before depreciation and amortization minus interest expense scaled by book equity.
    4. Diversification neither assures a profit nor guarantees against loss in a declining market.

    Eugene Fama and Ken French are members of the Board of Directors of the general partner of, and provide consulting services to, Dimensional Fund Advisors LP

    This information is not meant to constitute investment advice, a recommendation of any securities product or investment strategy (including account type), or an offer of any services or products for sale, nor is it intended to provide a sufficient basis on which to make an investment decision. Investors should consult with a financial professional regarding their individual circumstances before making investment decisions.

    Dimensional Fund Advisors LP is an investment advisor registered with the Securities and Exchange Commission. Dimensional funds are distributed by DFA Securities LLC.

    Investment products: • Not FDIC Insured • Not Bank Guaranteed • May Lose Value
    Dimensional Fund Advisors does not have any bank affiliates.

    dimensional.com
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