Dimensional ETF Trust - Dimensional Emerging Markets High Profitability ETF (DEHP)

Overview

The Dimensional Emerging Markets High Profitability ETF (DEMP) aims to provide long-term capital appreciation by investing in a broad range of companies in emerging markets with high profitability. It focuses on companies with relatively high profitability, as measured by metrics like return on equity or return on assets, within the emerging markets universe.

Reputation and Reliability

Dimensional Fund Advisors (DFA) is a well-regarded investment management firm known for its systematic, factor-based investment approach and low expense ratios.

Management Expertise

DFA's management team has extensive experience in quantitative investing and a strong track record in implementing factor-based strategies.

Goal

To provide long-term capital appreciation by investing in profitable companies within emerging markets.

Investment Approach and Strategy

Strategy: The ETF employs a systematic investment strategy focused on selecting and weighting companies based on profitability factors, market capitalization, and relative price. It does not track a specific index but rather uses a rules-based approach.

Composition The ETF primarily holds stocks of companies located in emerging market countries. It aims to maintain diversification across sectors and countries within the emerging markets universe.

Market Share: The market share of DEMP is relatively small compared to larger, more established emerging market ETFs.

Total Net Assets (AUM): 932859520

Key Competitors

• Vanguard FTSE Emerging Markets ETF (VWO)
• iShares Core MSCI Emerging Markets ETF (IEMG)
• iShares MSCI Emerging Markets ETF (EEM)

Competitive Landscape

The emerging markets ETF industry is highly competitive, dominated by large players like Vanguard and iShares. DEMP differentiates itself through its focus on high profitability companies, a factor-based approach, and DFA's investment philosophy. DEMP benefits from exposure to potentially higher-quality companies, but may lag during periods when other factors, like growth or momentum, are favored by the market.

Historical Performance: Historical performance data should be obtained from reliable financial data sources. Performance will vary depending on the time period analyzed.

Benchmark Comparison: Benchmark comparison should be made against a broad emerging markets index, such as the MSCI Emerging Markets Index. Data must be obtained from reliable financial data sources.

Expense Ratio: 0.32

Average Trading Volume

The average trading volume is moderate, indicating acceptable liquidity for most investors.

Bid-Ask Spread

The bid-ask spread is generally tight, suggesting relatively low transaction costs.

Market Environment Factors

Economic growth in emerging markets, trade policies, currency fluctuations, and geopolitical events can significantly impact the ETF's performance.

Growth Trajectory

Growth trends depend on the performance of emerging markets economies and the effectiveness of DFA's investment strategy. Changes to strategy and holdings are disclosed periodically.

Competitive Edge

DEMP's competitive edge lies in its focus on high-profitability companies within the emerging markets universe, which can lead to better long-term returns compared to broad market exposure. DFA's systematic, factor-based approach also contributes to its competitive advantage. This approach filters for higher-quality companies and reduces exposure to potentially overvalued stocks. The ETFu2019s investment strategy is rigorously applied and aims to outperform traditional market-cap weighted indexes in the long run.

Volatility

Historical volatility should be assessed using standard deviation or beta. Data must be obtained from reliable financial data sources.

Market Risk

The ETF is subject to market risk associated with emerging markets, including political instability, economic volatility, and currency risk. The focus on higher profitability companies may partially mitigate these risks but does not eliminate them.

Ideal Investor Profile

The ideal investor is a long-term investor seeking exposure to emerging markets equities with a focus on companies with high profitability.

Market Risk

The ETF is suitable for long-term investors and passive index followers who believe in the long-term potential of emerging markets and the value of profitability as a factor.

Dimensional Emerging Markets High Profitability ETF (DEMP) offers exposure to emerging markets equities with a focus on companies exhibiting high profitability. It's managed by Dimensional Fund Advisors (DFA) using a systematic, factor-based approach. While smaller compared to major emerging market ETFs, DEMP's distinct investment strategy may appeal to investors prioritizing quality and long-term capital appreciation. Investors should carefully consider the risks associated with emerging markets and DFA's unique investment methodology before investing. It is most suitable for investors with a long-term investment horizon.

Data Sources:

• Dimensional Fund Advisors Website
• Morningstar
• Bloomberg
• ETF.com

Disclaimers:

The data and analysis provided are for informational purposes only and do not constitute financial advice. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Market share estimates may vary based on the source and calculation methodology.