DUSB Profile
The Dimensional ETF Trust focuses on optimizing returns through investments in ultra-short maturity, investment-grade U.S. securities. The fund, known for its strategic emphasis on maintaining a short duration, primarily targets securities with maturities of less than one year. However, it also has the flexibility to extend its investment horizon to include securities with longer maturities if favorable yield opportunities arise. This approach aims to balance high-quality investments with potential yield enhancements.
The portfolio is designed to be diversified across a broad range of fixed-income securities. This includes U.S. government and agency obligations, corporate bonds, foreign bonds, as well as other high-quality debt instruments. The fund invests in various short-term instruments such as certificates of deposit, commercial paper, bankers' acceptances, and notes, ensuring a well-rounded exposure to the short-term debt market. By focusing on high-quality securities, the fund seeks to mitigate credit risk while optimizing income generation.
The fund's strategy involves maintaining an average portfolio maturity of one year or less. This duration strategy allows the fund to adapt to changing interest rate environments and seek opportunities to enhance returns based on expected term premiums. In addition to its core investments, the fund may employ financial derivatives such as futures contracts and options to manage interest rate exposure. Securities lending is also utilized to potentially increase income.
As an actively managed fund, the Dimensional ETF Trust's investment decisions are guided by the Adviser’s discretion, resulting in a dynamic approach to portfolio management. This flexibility can lead to a higher degree of portfolio turnover compared to passive strategies, as the fund adapts to market conditions and seeks optimal returns. The active management approach ensures that the fund remains responsive to changes in interest rates and market opportunities.
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