dfsv and avuv are two relatively new Ultra targeted Factor ETFs from dimensional and Avantis respectively for U.S small cap value stocks I compare them here before diving into the details on dfsv and AV UV let's first briefly review Factor investing if you've landed here you're probably already pretty familiar with it if not I've got a huge blog post on factors that I'll link to in the description you might even already own avuv and are wondering whether you should switch to dfsv basically Financial Academia ironically mostly from dimensional themselves has identified independent sources of portfolio risk that we call factors these sources of return are responsible for the differences in performance between Diversified portfolios two of those that are especially relevant to this discussion are size and value I.E small and underpriced stocks we expect these factors to pay a premium over the long term and thus overweight them in the portfolio relative to the market for the longest time dimensional fund advisors or DFA for short or the gold standard for funds that deliver exposure to these risk factors most effectively DFA was actually founded in 1981 on this specific idea DFA themselves set out to research this idea of independent sources of risk and then implemented their findings in live funds founder David Booth has explicitly said that DFA is all about the implementation of those great ideas and this has proved fruitful for the firm's clients in fact the researchers who have long been the foremost experts on Factor research Eugene Fama and Kenneth French as well as other big names in financial Academia such as Merton Miller and Myron scholes were on the board of DFA to help guide this evidence-based investing philosophy dimensional has been making headlines in recent years because their funds weren't available to retail investors until just a few years ago when they began converting their mutual funds to ETFs but not all of their mutual funds have an ETF equivalent around the same time some people left DFA to start their own fund house called Avantis continuing the scientific approach drawing on dimensional DNA combined with some new ideas avantas have quickly proven themselves with some impressive Factor funds at relatively low fees dfsv from dimensional which launched in early 2022 is the new ETF counterpart for their mutual fund DFS VX that was established in 1993 avuv from Avantis launched in late 2019 with DFS VX arguably being the inspiration so why would we be interested in either of these funds in the first place in case you didn't pick up on it already we're interested in getting the most Factory exposure bang for our buck and funds from the folks who quite literally wrote the book on factors are probably the best way to do that there are a multitude of small cat value funds available nowadays I compared a handful of the best and most popular ones in a separate video here in short we can show empirically that funds like dfsv and avuv provide Superior exposure to their index-based competitors such as vbr and viov from Vanguard and they seem to be able to easily overcome their greater fees that is dfsv and avuv are probably the most efficient and most effective targeting we can hope for as retail investors with long only portfolios so now let's look at some number numbers to specifically compare These funds here are the factor loadings for dfsv and avuv as you can see these two funds are very close avuv appears to slightly win out on most Dimensions these slight differences also show up with AV UV having a lower average market cap by about 10 and a lower p e ratio by about 25 percent compared to dfsv next we'll look at the performance of dfsv versus avuv using dfsv's mutual fund equivalent dfsvx to extend the back test by a couple years here's that versus avuv for the period October 2019 through 2022 while it's a very short time period avuv is beaten dfsv on a general and risk-adjusted basis so should you go with dfsv or avuv I think the primary takeaway here is that these are very similar funds with similar methodologies so you can't really go wrong either way and both would be a fine choice for targeted Factor exposure in U.S small cap value stocks in a taxable account these would also be a good pair for tax loss harvesting I personally already owned avuv when dfsv came out and I see no compelling reason to switch if it ain't broke don't fix it conveniently avuv is also slightly cheaper with a fee of 0.25 percent compared to 0.31 percent for dfsv I would feel perfectly comfortable owning either and it is not obvious that one is objectively better than the other a choice between them may simply come down to personal intangible preference of Provider if you're indecisive you could always go 50 50 with both in the scope of portfolio management this decision should be pretty low on your priority list I covered some other small cap value funds from around the globe in this video here conveniently dfsv and avuv should be available at any major broker what do you think of these funds do you own either let me know in the comments thanks for watching I am long avuv in my own portfolio