Today is Part II of a series of articles entitled: Dimensional Fund Advisors: Who Are They and What Makes Them So Valuable to Investors?
The core of the Dimensional Funds history stems back to their founders: David G. Booth and Rex Sinquefield. Prior to my research, I had never heard of either of these two men, but it would appear that they are both considered “Rock Stars” of the Investment world. Let’s do a bit of history on both of them.
David G. Booth is the CEO and Co-Chair Executive Office of Dimensional Fund Advisors. Mr. Booth was raised in Lawrence, Kansas. In 1968 and 1969 he received a B.A. and an M.A. in Economics from the University of Kansas. In 1971, he graduated with an M.B.A. from the University of Chicago where he met his future DFA partner, Rex Sinquefield. A key influence on Mr. Booth was his time spent as a research assistant to Eugene Fama, the economist who is credited as the “father of efficient markets hypothesis” that now guides modern investing.
In 2008, Mr. Booth is credited with making one of the largest donations to an American university in history. He donated $300 million to his alma mater, the University of Chicago’s Graduate School of Business. Mr. Booth felt indebted to the school, having been quoted as saying:
“The University of Chicago basically plucked me out of Kansas and put me on this trajectory…Sometimes I wonder, why me? But it happened.”
The University of Chicago’s Graduate School of Business has since been renamed the school to the University of Chicago Booth School of Business in Booth’s honor.
Mr. Booth has historically been a private person, choosing to remain out of the limelight. In light of this very large donation, Mr. Booth recognizes that he is now stepping out into the public eye. The Wall Street Journal quotes:
“The gift represents a coming-out for Mr. Booth, who is largely unknown outside the rarefied world of academic research and in finance. In the 27 years since founding Dimensional, Mr. Booth has played a behind-the-scenes role, while his now-retired partner, Rex Sinquefield, was the public face of the company.
Mr. Booth said he is nervous about stepping out into the public with the grant and namesake school. “We’ve worked really hard at keeping a low profile,” he said in an interview. Now, “my life as I know it will be changing,” he said.
In my next blog, I will discuss Mr. Booth’s founding partner, Rex Sinquefield.
– Sharon Kinter, Associate Financial Planner and Budget Coach, 26-May-2011
