Certain Dimensional Funds changing to an ETF structure

We wanted to provide an update regarding a few of the Dimensional funds we commonly use in taxable accounts. The Dimensional Fund Advisors (DFA) US tax-managed funds listed below will be converting from a mutual fund structure to an exchange traded fund (ETF) structure. It’s important to note we are closely reviewing this conversion. If you hold any of these funds, there is no action required on your part, however we wanted to ensure you had notice of this change.

The investment objectives of these funds will not be changing and the conversion from mutual funds to exchange traded funds (ETFs) will be organized as a tax-free event for US tax purposes so we anticipate no taxes related to the conversion of full shares. There may be some cases where fractional shares are held in the mutual fund and at the current time, ETF shares are not issued in fractional shares. In this case, any fractional mutual fund shares held in your account on the date the shares convert will be redeemed and paid out, which may result in a very small taxable event. For example, if fractional shares worth $25 were held and redeemed, the relevant tax rate would be applied to the capital gain portion of these shares resulting in total taxes paid of less than $25.

The conversion is expected to take place in June. After the conversion, the mutual funds will no longer exist and any new investment in these particular strategies will be into the ETFs. In the coming weeks you may receive a statement in the mail from the custodian of your account(s) notifying you of this change and providing additional information about the conversion. We are happy to answer any questions you may have or discuss during our next meeting.