The Alpha Brew: Dimensional Discusses Active Filtering Strategy at Exchange 2026

With over $260 billion in ETF assets and a suite of 41 funds as of March 23, Dimensional is poised to continue bringing its unique brand of systematic investing to the masses. At the 2026 ETF Exchange event last week, TMX VettaFi met up with Wes Crill, senior investment strategist at Dimensional, to discuss how the firm became an industry leader.

The interview with Crill came just days before the aforementioned launch of the Dimensional US Micro Cap ETF (DFMC). DFMC became the first-ever actively managed ETF launched as a secondary share class from an existing mutual fund. It effectively broke down any barriers between ETFs and mutual funds, proving that the structures can coexist in a competitive fund marketplace.

Before all this, however, Dimensional was the first firm to receive SEC exemptive relief for a dual-share class structure. What allowed them to get SEC approval before other ETF providers?

“We were probably the most direct in terms of identifying what [the SEC’s hesitancies] were, and then satisfying them with the language in our proposal,” Crill noted.

While he admits the infrastructure for this shift will take time to build, the slow-moving avalanche is inevitable: “The goal is always to just give investors more choice over time. And I think if you have the industry rowing together towards that goal, that’ll benefit everyone in the end.”

At the ETF Exchange conference, the rise of active was a topical theme that got consistent airtime. In the current market environment where investors are clamoring for active management, Dimensional has carved out a unique space. Crill explained that “active” doesn’t necessarily mean high-turnover stock picking. Instead, it refers to active implementation.

“Active doesn’t mean what it used to… the perception 10 years ago would have meant someone who was maybe going out and picking stocks,” Crill explained. “Our philosophy about markets is passive, because we believe market prices are the best prediction of the future. But, our implementation is absolutely active, because that’s how you increase expected returns.”

This index replacement strategy allows Dimensional to offer institutional-grade tilts in funds such as the Dimensional U.S. Core Equity 2 ETF (DFAC B+) and the Dimensional US Marketwide Value ETF (DFUV A-). Both funds offer investors broad equities exposure while systematically choosing companies with higher expected returns. In doing so, DFAC and DFUV offer extremely competitive expense ratios in the active wrapper — 17 basis points and 21 basis points, respectively.

Coffee-making and investing — the two have more in common than one would think. With regard to Dimensional’s systematic methodology, Crill pointed out that the process is akin to making a perfect cup of coffee.

Crill noted that most are fixated on the “grounds” or analogous to portfolio management, the stock tilts. However, the most important ingredient is actually the “water” or the initial filtering.

“The first thing you gotta do is filter out some of those impurities,” Crill explained. For Dimensional, this means excluding stocks with low expected returns or recently minted IPOs where liquidity overhangs might muddy valuations.

“These are all the refinements we can make to get the best water before we apply the grounds, and that’s really where we apply the tilts,” Crill added.

This rigorous filtering process extends to Dimensional’s international and fixed-income ETF products. On the international equities front, the actively managed Dimensional International Core Equity Market ETF (DFAI ) leverages the firm’s decades of experience to locate opportunities globally that passive funds can’t find.

In the fixed income arena, the Dimensional Core Fixed Income ETF (DFCF ) provides a dynamic alternative to core bond exposure that simply tracks the Bloomberg U.S. Aggregate Bond Index. Unlike a traditional bond index that blindly allocates to the largest debt issuers, Dimensional’s daily flexibility allows them to shift the fund’s weightings according to yield curves and credit spreads.

“Our daily process with flexibility gives us a big leg up over index fund type of approaches,” Crill noted.

The firm’s upcoming 45th anniversary is a testament to Dimensional’s durability. During the interview, Crill made mention of Dimensional’s 100% fund survival rate over the last 20 years. While only about 50% of the industry’s funds from two decades ago still exist today, every Dimensional solution has stood the test of time.

What’s the secret sauce to Dimensional’s longevity? Human capital with immense talent? The firm has an abundance of that, but there are a couple of things Crill points to — creating repeatable strategies and “flexibility in terms of our implementation.”

“It’s because we have a process that’s repeatable,” said Crill. “The track record is something that hopefully [investors] can count on going forward.”

“If you buy one of our portfolios thinking it’s going to fill a style box, you can can count on that being consistent through time,” Crill added.

While staying true to its academic DNA, and at the same time embracing the flexibility of the ETF wrapper, Dimensional isn’t just surviving the evolution of the industry — it’s rewriting the narrative.

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