Dimensional Targeted Value ETF Gains 51.8% Five-Year Return with 28bps Fee
Dimensional Targeted Value ETF returned 25.58% over one year and 51.8% across five years with a 0.28% expense ratio, compared to iShares Russell 2000 Value’s 29.82% and 38.76% gains and the Russell 2000’s 20.23%. Its dual value and profitability screen excludes unprofitable small-caps, driving long-term outperformance despite recent lag.
1. Performance Comparison
Over the past year, DFAT returned 25.58%, trailing the iShares Russell 2000 Value’s 29.82% gain, while achieving 51.8% across five years compared with 38.76% for iShares Russell 2000 Value and 20.23% for the Russell 2000 index.
2. Dual Screen Strategy
DFAT applies a rules-based methodology filtering for low price-to-book ratios and profitability metrics, systematically excluding unprofitable small-caps to target factor premiums identified by academic research.
3. Portfolio Composition
Financials account for nearly 28% of the fund, led by regional banks and insurers, with industrials and consumer discretionary making up roughly 30%, reflecting a cyclical tilt supported by a 3.75% Fed funds rate and a 0.55% yield curve slope.
4. Recent Performance Analysis
Short-term performance lagged due to the profitability screen and tighter value criteria underperforming in a rally that broadly boosted cheap small-caps regardless of earnings quality.