We at Lighthouse Financial Advisors believe in investing strategically in Dimensional Fund Advisors (DFA) mutual funds because of their unique approach of translating financial science into practical investment solutions for clients. We invest in Dimensional to build portfolios along the dimensions of expected returns that can be pursued in a cost-effective manner. Their dynamic, market-driven process and flexible trading strategies allows them to manage the tradeoffs that matter for performance, while balancing opposing premiums, diversification, and costs. Dimensional’s process is applied consistently across a broad range of competitively priced strategies, which span asset classes and geographies, to help meet the diverse needs of investors worldwide.
At Lighthouse, we avoid the traps of Conventional Investing. Those are making prediction bets, searching for the “best” fund managers, investing based on what the media says and being influenced by stock tips from acquaintances. We, and DFA, base our investments on the four principles of Strategic Investing listed below:
1) Market Equilibrium:
- Trying to outsmart other investors is very tough to do, almost so that we feel it is impossible. Market prices are based on many competitive buyers and sellers with the same public information, but different opinions about the expectations of an investment.
- Regardless of what you’re invested in, each holding carries risk one way or the other. By investing in many groups of investments around the world you help reduce the risk of losing your overall net worth.
3) Asset Allocation:
- We work with you to discover the Investments you’re comfortable making. Various groups of stocks and bonds carry various degrees of risk and expected return. We want you to feel comfortable in the investments you decide on.
4) Purpose and Discipline:
- Investing is the journey to a personalized financial destination. First, the plan is created, then the process gets put in place and then you finalize with the product to invest in. Whether it is a good or bad market you should always stick to your plan.
For more information on Dimensional Fund Advisors, view their site at: http://us.dimensional.com/