Our approach to investing was forged in the fires of peer-reviewed academic research. It has been hammered, folded, hardened, and honed by economic scientists testing and retesting previous results and assumptions. Leading these financial “swordsmiths” are a host of Nobel Laureates, including many who have provided guidance to our favorite mutual fund family, Dimensional (DFA).
Of those, possibly the best known is Eugene Fama from the University of Chicago. Last year, Professor Fama was awarded the Nobel Prize in Economics. In response, Professor Fama’s student and now, employer, David Booth, penned a congratulatory document that succinctly describes many of the reasons for our selection of DFA as our primary provider of equity fund management (out of thousand of available managers).
Not only will the linked PDF file explain the philosophy behind DFA; it also includes the text of Professor Fama’s Nobel acceptance speech.