Tell us who you are
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Dimensional Investing is about implementing the great ideas in finance for our clients.

Dimensional* at a Glance
As of September 30, 2016

Years since founding

In firmwide assets under management, USD (in billions)

Offices in eight countries

Employees globally

Do you have an investment approach you can stay with during turbulent markets?

In USD. Industry net new cash flow data provided by Investment Company Institute© based on the approximately 4,600 US-domiciled equity (domestic and international) mutual funds reported on an aggregate level to the Investment Company Institute©. This includes information on Dimensional’s US-domiciled funds during this period. Dimensional estimated net flow data provided by Morningstar based on Dimensional’s US-domiciled equity mutual funds. For illustrative purposes only.

01

An enduring belief in the

Power of  Markets

Capital Markets Have Rewarded
Long-Term Investors
Growth of $1 USD, Jan. 1926–Dec. 2015

In USD. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. US Small Cap Index is the CRSP 6–10 Index; US Large Cap Index is the S&P 500 Index; Long-Term Government Bonds Index is 20-Year US Government Bonds; Treasury Bills are One-Month US Treasury bills; US Inflation is measured as changes in the US Consumer Price Index. CRSP data is provided by the Center for Research in Security Prices, University of Chicago. The S&P data is provided by Standard & Poor’s Index Services Group. Bonds, T-bills, and inflation data provided by Morningstar. Past performance is no guarantee of future results.

At Dimensional, our investment approach is based on a belief in markets.

Rather than relying on futile forecasting or trying to outguess others, we draw information about expected returns from the market itself—letting the collective knowledge of its millions of buyers and sellers set security prices.

Letting markets do what they do best—drive information into prices—frees us to spend time where we believe we have an advantage, namely in how we interpret the research, how we design and manage portfolios, and how we service our clients. It means we take a less subjective, more systematic approach to investing—an approach we can implement consistently and investors can understand and stick with, even in challenging market environments.

How Many Funds Outperformed Benchmarks?
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Only 15% of US equity and fixed income funds that were around in 2000 beat an industry benchmark, 15 years later. Over the same time period, 82% of US equity and fixed income Dimensional funds outperformed their benchmarks. The figures are drawn from a selected universe of industry and Dimensional funds. Please refer to the disclosure for more details.

Data from the CRSP Survivor-Bias-Free US Mutual Fund Database, provided by the Center for Research in Security Prices, University of Chicago. Sample includes funds available at the beginning of the 15-year period ending December 31, 2015. Dimensional funds exclude VA funds and those distributed exclusively through Loring Ward. Industry funds exclude index funds, sector funds, and funds with a narrow investment focus, such as real estate and gold, money market funds, municipal bond funds, asset backed security funds, and non-US bond funds. Success rates are determined by the percentage of funds that survived and outperformed a benchmark over the 15-year period, net of fees and expenses. Dimensional funds are compared to prospectus benchmarks. Industry funds are compared to the diversified benchmark index with which they were most highly correlated over the sample period. For further methodology details, see the Mutual Fund Landscape brochure.

David Booth
David Booth
Founder and Co-Chief Executive Officer
“The number of managers that can successfully pick stocks are fewer than you’d expect by chance. So, why even play that game? You don’t need to.”

02

Applying insights from

FINANCIAL SCIENCE

Breakthroughs in Modern Finance
  • 1966Efficient Market Hypothesis
     
    Efficient Market Hypothesis
    Eugene Fama
    Nobel laureate, 2013
    Professor, University of Chicago
    Eugene Fama’s efficient market hypothesis marks a pivotal moment for modern finance. The essence of the argument can be described by the simple statement that security prices reflect all available information.
  • 1973Intertemporal CAPM
     
    Intertemporal CAPM
    Robert Merton
    Nobel laureate, 1997
    Professor, MIT
    The ICAPM set up a theoretical framework for how multiple sources of risk could arise. It expanded on the one-period CAPM model where the only priced risk was market beta.
  • 1981Small Cap Investing
     
    Small Cap Investing
    Dimensional Fund Advisors
    David Booth, Founder
    and Co-CEO
    Dimensional pioneers small cap investing with the launch of its first strategy, which offers investors diversified, efficient access to small company stocks.
    1981 Dimensional Founded
  • 1983Term Structure
     
    Term Structure
    Eugene Fama
    Nobel laureate, 2013
    Professor, University of Chicago
    Research shows implied forward interest rates provide information on expected term premiums in fixed income.
  • 1992Value Breakthrough
     
    Value Breakthrough
    Eugene Fama
    Nobel laureate, 2013
    Professor, University of Chicago
    Kenneth French
    Professor, Dartmouth College
    Eugene Fama and Kenneth French develop the three-factor asset pricing model, which identifies market, size, and price (value) factors as the principal drivers of equity returns.
  • 2012Profitability
     
    Profitability
    Eugene Fama
    Nobel laureate, 2013
    Professor, University of Chicago
    Kenneth French
    Professor, Dartmouth College
    Robert Novy-Marx
    Professor, University of Rochester
    A body of academic research led to identifying profitability as a dimension of higher expected returns that can be pursued across equity markets.
  • Today
     
     
    Dimensional’s Research and Investment teams draw insight from academia, but what sets us apart is how we interpret, test, and apply that research to practical investment solutions for our clients.
  • Tomorrow
    ...
     
    Dimensional was built around a set of ideas bigger than the firm itself. With a confidence in markets, deep connections to the academic community, and a focus on implementation, we go where the science leads, and continue to pursue new insights, both large and small, that can benefit our clients.

Eugene Fama and Kenneth French are members of the Board of Directors for and provide consulting services to Dimensional Fund Advisors LP. Robert Merton and Robert Novy-Marx provide consulting services to Dimensional Fund Advisors LP.

Dimensional’s investment approach is grounded in economic theory and backed by decades of empirical research.

Our internal team of researchers works closely with leading financial economists to better understand where returns come from.

Research has shown that securities that offer higher expected returns share certain characteristics, which we call dimensions. To be considered a dimension, these characteristics must be sensible, persistent over time, pervasive across markets, and cost-effective to capture.

The Evolution of Indexing and Dimensional
Eugene Fama
Eugene Fama
Nobel laureate, 2013 Professor, University of Chicago; Director and Consultant, Dimensional
“We’re very careful in looking at new research that comes along and making sure it’s robust.”

Understanding what drives returns is the starting point. From here, we focus on fine-tuning our method of capturing them.

We structure broadly diversified portfolios that emphasize the dimensions of higher expected returns, while addressing the tradeoffs that arise when executing portfolios.

Every day our portfolio managers and traders seek to balance costs against expected returns and diversification. We work for the slightest expected gain, as every incremental improvement can add up over time.

The Gap Between Reality
and a Model
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Limitations of the Model False Positives Insights MODEL REALITY
Academic models provide useful insight, but they are incomplete. It’s in the gap between reality and a model where sound judgment and experience matter. Play Watch Dimensional Stories: Models
(03:07)
Eduardo Repetto
Eduardo Repetto
Co-Chief Executive Officer; Co-Chief Investment Officer
“The money we manage is not our money—it’s our clients’ past and their future. We take that responsibility very seriously.”

03

A commitment

TO OUR CLIENTS

The Global Financial Crisis and Its Aftermath
A key to a good long-term investment experience is being able to stay with your investment philosophy, even during tough times. During the rocky 2008–2012 period, many investors sold their equity funds. Dimensional’s equity funds had inflows throughout the period, which could suggest that in aggregate investors were prepared to withstand the market’s movements in order to pursue long-term results.

In USD. Dimensional estimated net flow data provided by Morningstar based on Dimensional’s US-domiciled equity mutual funds. Industry net new cash flow data provided by Investment Company Institute© based on the approximately 4,600 US-domiciled equity (domestic and international) mutual funds reported on an aggregate level to the Investment Company Institute©. This includes information on Dimensional’s US-domiciled funds during this period. For illustrative purposes only.

Dimensional Investing is about providing a successful investment experience.

That means more than considering investment returns. It means offering peace of mind knowing that a transparent approach backed by decades of research is powering every decision.

Markets go up and they go down. The goal of Dimensional Investing is to help people be prepared, so they can stick with their plan.

Institutional Investor’s
2016 Money Masters
Dave Butler
DAVE BUTLER
Global Head of Financial Advisor Services
“The client experience has always been, and will continue to be, why we do what we do.”

*“Dimensional” refers to the Dimensional separate but affiliated entities generally, rather than to one particular entity. These entities are Dimensional Fund Advisors LP, Dimensional Fund Advisors Ltd., DFA Australia Limited, Dimensional Fund Advisors Canada ULC, Dimensional Fund Advisors Pte. Ltd., and Dimensional Japan Ltd.

Dimensional Fund Advisors LP is an investment advisor registered with the Securities and Exchange Commission. Consider the investment objectives, risks, and charges and expenses of the Dimensional funds carefully before investing. For this and other information about the Dimensional funds, please read the prospectus carefully before investing. Prospectuses are available by calling Dimensional Fund Advisors collect at (512) 306-7400 or at us.dimensional.com. Dimensional funds are distributed by DFA Securities LLC. None of the other Dimensional entities are currently licensed by, registered with, or supervised by the Securities and Exchange Commission. Nothing on this website shall constitute or serve as an offer to sell products or services in any country or jurisdiction by any Dimensional global firm. For informational purposes only. All information is given in good faith and without warranty and should not be considered investment advice or an offer of any security for sale.

Eugene Fama is a member of the Board of Directors for and provides consulting services to Dimensional Fund Advisors LP.

Research Dimensional Fund Advisors and DFA Securities with FINRA's BrokerCheck.

Profitability is a measure of current profitability, based on information from individual companies’ income statements