Ok, getting questions from advisers about Dimensional funds.
Apparently, DFA is being trashed on Facebook or some other social media platform for its performance or lack thereof. I'm not on these forums. Don't give a hoot.
But... for those asking, here's a thought..
Apparently, DFA is being trashed on Facebook or some other social media platform for its performance or lack thereof. I'm not on these forums. Don't give a hoot.
But... for those asking, here's a thought..
First @Betafolio uses DFA in our portfolios. What do we think of DFA's perf?
Short answer.. doesn't matter! Well, shouldn't if you have a diversified portfolio in first place.
Regardless of DFA's perf, @betafolio models faired pretty well against popular multi-asset ranges
Short answer.. doesn't matter! Well, shouldn't if you have a diversified portfolio in first place.
Regardless of DFA's perf, @betafolio models faired pretty well against popular multi-asset ranges
But of course, DFA's primary domain is factor premium - particularly Value & Size, which have lagged the broad market over the last few years.
The very nature of value factor is that it can undergo prolonged period of underperformance. This is why it's called 'risk factors'.
The very nature of value factor is that it can undergo prolonged period of underperformance. This is why it's called 'risk factors'.
There's a raging debate on 'death of value investing'
Grandads of factors Fama/French: nope, all pretty normal. papers.ssrn.com/sol3/papers.cf…
Blitz @Robeco: may be, other factors better papers.ssrn.com/sol3/papers.cf…
PhDs @AQR: report of death greatly exaggerated
papers.ssrn.com/sol3/papers.cf…
Grandads of factors Fama/French: nope, all pretty normal. papers.ssrn.com/sol3/papers.cf…
Blitz @Robeco: may be, other factors better papers.ssrn.com/sol3/papers.cf…
PhDs @AQR: report of death greatly exaggerated
papers.ssrn.com/sol3/papers.cf…
But whatever...
If you're going to compare Vanguard and Dimensional, do a like-for-like comparison.
E.g. Dimensional's UK Core against against Vanguards FTSE UK...
If you're going to compare Vanguard and Dimensional, do a like-for-like comparison.
E.g. Dimensional's UK Core against against Vanguards FTSE UK...
Dimensional UK Value vs Vanguard UK Equity Income
Perhaps not exact like-for-like but sort of similar domain...
Perhaps not exact like-for-like but sort of similar domain...
Dimensional International Core vs Vanguard Developed ex UK
Dimensional EM Core vs Vanguard EM...
Small Cap?
Point? Some factors are struggling..Vanguard or Dimensional.
Dimensional happens to 'specialise' in factors. So they're probably feeling the pain more. But on a like-for-like, little evidence that Vanguard factor funds fare better.
Worst possible time to abandon small/value.
Dimensional happens to 'specialise' in factors. So they're probably feeling the pain more. But on a like-for-like, little evidence that Vanguard factor funds fare better.
Worst possible time to abandon small/value.
Moral?
Know what you own, why you own it. Diversification means ALWAYS having to 'apologise' for some part of your portfolio that's 'underperforming'.
Right now, we're 'apologising' for small value. That's diversification.
Rejoice. No pain, no premium!✌🏾
Know what you own, why you own it. Diversification means ALWAYS having to 'apologise' for some part of your portfolio that's 'underperforming'.
Right now, we're 'apologising' for small value. That's diversification.
Rejoice. No pain, no premium!✌🏾
