David Booth: 45 Years to $1 Trillion at Dimensional | #646

Today’s guest is David Booth, founder of Dimensional Fund Advisors, which now manages over $1 trillion. He studied under Eugene Fama at Chicago and helped build one of the first index funds at Wells Fargo.

In today’s episode, David traces Dimensional’s arc from indexing’s earliest days at Wells Fargo to crossing $1 trillion in AUM this year. He shares what Gene Fama said when he got the call, the story of driving a client to Chicago to walk through the Fama-French paper, and why AI investing looks like the California gold rush.

To close, David makes the case for judging yourself by decisions, not outcomes.

Get David's book: Stay Calm: Learn to Embrace Uncertainty in Investing and Life

(0:00) Introduction

(0:58) David Booth's start to investing

(3:38) The beginnings of index funds and early challenges at Dimensional

(10:09) Long-term investment perspectives and the Fama-French three-factor model

(17:26) Dimensional’s educational focus and advisor partnerships

(20:21) Small cap value performance, AI & market trends

(23:26) Symbolism of bankrupt stock certificates and lessons on diversification

(25:44) Compounding for 45 years