US quantitative investing pioneer Dimensional Fund Advisors has listed two of its systematic active exchange traded funds (ETFs) in London.
The Dimensional Global Core Equity and Global Targeted Value Ucits ETFs will have sterling and dollar share classes on the London Stock Exchange and euro shares listed on Xetra.
Dimensional, which has amassed $226bn its 40-plus ETF range, says its active ETFs are not managed in reference to a benchmark, but are designed to long-term outperformance. They use evidence-backed factors to predict which stocks will do well rather than traditional human stock pickers.
As such, both funds list comparator indices, with the core equity fund (sterling ticker DPGC) running against the MSCI World index and charging a total of 0.26% a year.
The global value fund (sterling ticker DPGT) is seeking to best the MSCI World SMID Value index on an ongoing annual charge of 0.44%.
The core equity fund has exposure to 4,568 stocks with Nvidia, the $5tn AI chip maker, its biggest holding at 3.9%. Its top 10 also includes US technology giants Apple, Microsoft, Amazon, Meta and Alphabet alongside drug company Eli Lilly and Berkshire Hathaway, Warren Buffett’s holding company that last week disclosed a $4.3bn position in Google-owner Alphabet.
The global value fund is also highly diversified with 2,261 holdings led by Hartford Insurance Group at 0.6%, followed by similarly sized positions in Delta Airlines, Occidental Petroleum, gas producer EQT Corp and GE Healthcare Technology. The top holdings are all US companies.
Further active ETF listings are in the pipeline, says Dimensional, which was founded in 1981 on the efficient market hypothesis of Nobel-prize winning economist Professsor Eugene Fama, who sits on its investment committee.
Nathan Lacaze, co-CEO, Dimensional Fund Advisors, said: “These first two European listings provide a new opportunity for investors to experience Dimensional investing, with its Nobel Prize-winning insights and decades of expertise working to outperform benchmarks and peers.”
