Dimensional Expands Sustainable ETF Suite

November 16, 2022

Dimensional Fund Advisors, the Austin, Texas-based firm with nearly $600 billion in assets under management, added a new exchange-traded fund Thursday to its new lineup of sustainable products. The launch comes after the firm introduced its first set of green ETFs earlier this month. 

The Global Sustainability Fixed Income ETF (DFSB), which lists on the NYSE Arca, uses the Bloomberg Global Aggregate Bond Index as its benchmark. It seeks to invest in a broad portfolio of investment-grade debt securities of U.S. and non-U.S. issuers that prioritize sustainability. 

Despite increasing scrutiny of sustainable investing products, recent studies and surveys suggest the sector can be a lucrative investment. BlackRock CEO Larry Fink’s 2022 memo noted that “the tectonic shift towards sustainable investing is still accelerating,” encouraging further investments into the sector. 

Research from BlackRock and Morningstar also found that global assets in sustainable fixed income ETFs have grown 36 times in volume from 2015 to 2021, up to $50 billion.  

“A robust investment framework rooted in financial science and integrating focused sustainability considerations allows for a cost-effective approach that provides investors the ability to reflect their values while maintaining sound investment principles,” said Isabelle Williams, Dimensional’s senior investment strategist. 

The new fund brings Dimensional’s ETF lineup to a total of 28—a portfolio that manages over $64 billion in assets. 

DFSB comes with an expense ratio of 0.24% and competes with other sustainability funds, such as the iShares USD Green Bond ETF (BGRN), the BNY Mellon Sustainable International Equity ETF (BKIS) and the Janus Henderson International Sustainable Equity ETF (SXUS)

 

Contact Zoya Mirza at [email protected] 

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