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Rating:Dimensional Prepares to 'Transition Management and Ownership' Not Rated 5.0 Email Routing List Email & Route  Print Print
Monday, December 14, 2009

Dimensional Prepares to 'Transition Management and Ownership'

Reported by Neil Anderson, Managing Editor

Dimensional Fund Advisors just made its first acquisition and split its CEO job in two. So what's next for the giant, specialty, index mutual fund firm? David Booth, chairman and co-founder (who, as reported by The MFWire on Thursday, will soon share his CEO reins with Eduardo Repetto, his chief investment officer) said the move is something of a generational shift, showing DFA's clients and employees that the firm will "transition management and ownership gradually from within." Meanwhile, on the product side, don't expect DFA to dive into ETFs just yet, though.

Dimensional co-CEOs Eduardo Repetto and David Booth

"We think our future is very bright," Booth told The MFWire in an interview, adding that splitting top jobs is what the DFA team is "used to". (Booth and DFA's other co-founder, Rex Sinquefield, shared the chairman spot until Sinquefield retired in 2005.)

Last month DFA signed a deal to purchase SmartNest, a web-based retirement plan advice system (see our sister publication, The 401kWire, 8/10/2009 and 12/2/2009). Then on Thursday, the Austin, Texas-based asset manager confirmed that Repetto (42) will step up as co-CEO (and continue to serve as CIO) on January 1, while Booth (63) will stay on as chairman and co-CEO. Booth describes the move as part of an "organic succession" at the firm.

"I still want to work," Booth said, insisting that he has no plans to retire yet, adding that there will be some other promotions at the firm, too. "We've got a good bench."

Booth also clarified that, at least for now, getting into the ETF business is not a priority for the non-retail fund firm (it distributes to institutions and through advisors).

"At this stage, we don't think it would be a high priority for us," Booth said, pointing to the bigger marketing effort associated with retail ETFs. "I don't think that's our skill set."

Repetto, a nine-year DFA veteran, previously studied aeronautical engineering (i.e. rocket science) at CalTech, and he's worked at CINI, IBM and Simulation Technologies. (One insider familiar with the situation pointed to Patrick Keating, vice president and chief operating officer, as someone who might also have been a contender for the top job at DFA.) 

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