Dimensional Short-Duration Fixed Income ETF

Dimensional Short-Duration Fixed Income ETF (DFSD) is an actively managed bond fund. It holds about 1,600 investment-grade bonds, mostly from companies, that generally mature within five years. Its 0.16% expense ratio is higher than similar funds such as VCSH, which charges 0.03%. In return, Dimensional adjusts the fund's credit quality and maturities toward the bonds where it expects extra return, and it hedges foreign bonds back to US dollars.

• Over the year to Oct 27, 2026, DFSD returned +1.1%, 7th of 8 among similar funds.
• Its worst full calendar year was 2022 (-5.8%); its best was 2025 (+6.6%).
• The deepest fall in its price history was 8.4% (Nov 18, 2021 to Oct 20, 2022), recovered by Jan 31, 2024.

As of Jul 31, 2026, the fund held 1,594 securities; the ten largest made up 9.05% of assets.

The bonds mature in 3.2 years on average (weighted by size), with an average coupon of 3.94%.

• Over the three months to Jul 31, 2026, investors added a net $625.1M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.31%, +0.19%, -0.22%.

DFSD does not track an index. Dimensional's managers choose its bonds, and the goal is to maximize total return, meaning income plus changes in price. Under normal conditions, at least 80% of net assets go into investment-grade bonds, those rated BBB- or higher by S&P or Fitch, or Baa3 or higher by Moody's. The fund leans toward bonds rated A+ to BBB-. It holds more or less of these lower-rated investment-grade bonds depending on the expected credit premium, which is the extra yield investors earn for taking on default risk.

Most holdings mature within five years. Duration measures how much a bond's price reacts to changes in interest rates. The fund keeps its duration between one year below and half a year above that of the ICE BofA 1-5 Year US Corporate & Government Index, which was about 2.56 years as of December 31, 2025. When longer bonds pay enough extra yield, the fund buys toward the long end of that range. Otherwise it stays shorter. As of July 31, 2026, the average maturity was 3.2 years. About 86% of assets were corporate bonds and about 7% were US Treasuries.

Bonds priced in foreign currencies are hedged back to dollars with currency forward contracts. The fund may also use credit default swaps, futures and options on futures, and it may lend its securities to earn extra income. Its portfolio turnover was 20%.

• DFSD charges 0.16% a year, versus an average of 0.11% for the similar funds below (6th of 8, cheapest first).
• Of that, 0.15% is the management fee; the rest covers other fund expenses.
• The fee includes a 0.01% waiver from the adviser, which may end.
• Using the prospectus's standard example, $10,000 invested would cost about $16 in the first year and $216 over 10 years (assuming a 5% annual return).

Its short-maturity, investment-grade bonds have moved far less than stocks, which suits money that may be needed within a few years.

DFSD launched in November 2021, so it has no record through the 2008 or 2020 crashes. When interest rates rose in 2022, it fell 7.6% between January 4 and September 27. Its deepest drop was 8.4%, from November 2021 to October 2022, and it took about 15 months to recover, by January 2024. Its worst calendar year was 2022, with a loss of 5.87%. A retiree who withdrew money during 2022 would have locked in modest losses.

Over the trailing 12 months, it yielded 4.51% as of October 27, 2026, with distributions paid quarterly. Its 0.16% expense ratio works out to $16 in the first year on $10,000 under the SEC's standard example. That is more than VCSH, IGSB and SPSB, which charge 0.03% to 0.04%. Past results don't predict future returns, and a plan should look at the whole portfolio, not one fund.

Matched by bond funds with the closest average maturity and issuer mix (N-PORT).