DFAC vs XLSR

DFACADimensional US Core Equity 2 ETF

XLSRCState Street US Sector Rotation ETF

In short

DFAC Dimensional's whole-market workhorse: roughly 2,600 US stocks in one ticker, run by managers who weigh federal tax consequences before they trade, at a fee closer to index funds than to active ones.

XLSR Sector timing, outsourced. State Street's Investment Solutions Group tilts toward and away from the S&P 500's GICS sectors using quant signals plus human judgment, typically rebalancing monthly, all inside one US large-cap ticker.

Stated mandate

DFAC The fund seeks long-term capital appreciation while considering federal income-tax implications in its investment decisions.

XLSR The fund seeks capital appreciation through active sector rotation. It uses quantitative and qualitative analysis to adjust sector exposures and typically rebalances monthly.

Why people hold it

• DFAC 0.17% a year for an actively run fund, well under the median fee among active US equity ETFs.
• About 2,600 US stocks under one ticker, so it holds the market broadly rather than a narrow slice of it.
• Federal income-tax implications sit inside the stated objective, not in a footnote, so they factor into what managers buy and sell.
• A multi-billion-dollar fund with a track record running back to 2007 and one of the strongest implementations in its peer group.

• XLSR State Street's Investment Solutions Group sets the sector over- and underweights using quantitative signals plus judgment, typically rebalancing monthly. The rotation call, in one ticker.ssga.comssga.com 2
• It dials active risk up and down against the S&P 500 rather than swinging all-in on one sector, so it still behaves like a US large-cap core position.ssga.com
• Running since 2019, a multi-billion-dollar fund that trades with reasonable ease and sits in the upper half of a very crowded active US equity field.

Worth knowing

• DFAC Actively managed, so there's no published index to check it against. Holdings and tilts shift at the managers' discretion.
• Dimensional's own DFAU runs a US core equity mandate for 0.12%, a slightly lighter fee for a similar shelf.
• All stocks, all US: the mandate is capital appreciation from equities, so it takes the market's full swings, and cash arrives quarterly.

• XLSR 0.70% a year is above the typical active US equity fund and multiples of systematic peers like DFAU (0.12%) and FELC (0.18%). Active judgment carries a price tag.
• A couple dozen positions means a handful of sector calls drive the outcome, and results can drift well away from the S&P 500 in either direction.
• The stated goal is capital appreciation, not income. Distributions arrive quarterly and are a byproduct of whatever the underlying sectors happen to pay.

Full DFAC profile⁠

Full XLSR profile⁠