Dimensional Emerging Markets Core Equity 2 ETF

Dimensional Emerging Markets Core Equity 2 ETF (DFEM) is an actively managed fund. As of July 31, 2026, it held about 6,700 stocks across emerging markets such as Taiwan, South Korea, India and China. It does not track an index. Instead, Dimensional leans toward smaller, lower-priced and more profitable companies. That approach costs 0.39% a year, more than broad index rivals such as IEMG at 0.09% or VWO at 0.07%.

• Over the year to Oct 27, 2026, DFEM returned +14.6%, 2nd of 9 among similar funds.
• Its worst full calendar year was 2024 (+7.5%); its best was 2025 (+29.5%).
• The deepest fall in its price history was 20.8% (May 4, 2022 to Oct 24, 2022), recovered by Jul 28, 2023.

As of Jul 31, 2026, the fund held 6,700 securities; the ten largest made up 24.27% of assets.

• Over the three months to Jul 31, 2026, investors added a net $401.6M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +7.86%, -1.95%, -4.55%.

DFEM does not track an index. Dimensional Fund Advisors starts with emerging-market companies in countries its Investment Committee has approved. These can include frontier markets, which are countries at an earlier stage of development. Within that group, companies start out weighted by market capitalization, the total value of their shares, so bigger companies get bigger slices. Dimensional then shifts weight toward smaller companies, value stocks and highly profitable ones. Value stocks are shares with a low price compared with book value, a company's net worth on paper. To make room, the fund trims larger, pricier or less profitable names.

The manager can also raise or cut positions based on shorter-term signals, such as price momentum. It trades flexibly to keep costs down. Portfolio turnover was 9% in the latest prospectus, which is low. At least 80% of net assets go into approved emerging-market stocks. As of July 31, 2026, Taiwan Semiconductor Manufacturing was the largest position, at 10.26%.

The fund may hold depositary receipts, which are shares of foreign companies traded on other exchanges. It may also hold China A-shares and variable interest entities, contract-based structures used to reach some Chinese companies. It may use futures to manage cash coming in and going out, currency forwards to settle trades, and equity swaps. It can also lend out securities for extra income.

• DFEM charges 0.39% a year, versus an average of 0.25% for the similar funds below (8th of 9, cheapest first).
• Of that, 0.33% is the management fee; the rest covers other fund expenses.
• Using the prospectus's standard example, $10,000 invested would cost about $40 in the first year and $493 over 10 years (assuming a 5% annual return).

It spreads money across about 6,700 emerging-market stocks that US-only funds don't hold, though it swings more than a typical core fund.

DFEM could add exposure to thousands of companies in Taiwan, South Korea, India, China and other emerging markets. Its history is short. It launched in April 2022, so it has no record through the 2008 or 2020 crashes. Its deepest drop was 20.8%, from May 4 to October 24, 2022. It took about nine months to recover, by July 28, 2023. It made money in each of its three full calendar years. The weakest was 2024, up 7.79% according to the prospectus, and its weakest quarter fell 6.79%. Selling during a slump like 2022's would lock in losses. Over the 12 months to October 27, 2026, it yielded 2.09%, paid quarterly. Its 0.39% fee is above the 0.25% average of similar funds. Past results don't predict future returns, and a retirement plan should weigh the whole portfolio, not one fund.

Matched by holdings overlap from the latest N-PORT reports.