DFA US Micro Cap ETF DFMC, Dimensional’s first exchange-traded share class of an existing mutual fund, began trading today, March 20, 2026. It marks the first time an actively managed ETF share class has been added to an existing mutual fund. Vanguard pioneered the structure in 2001 and applied it to its index-tracking mutual funds, and F/m Investments added a mutual fund share class to its existing Treasury 3 Month Bill ETF TBIL in mid-February.Dimensional’s journey to providing an ETF share class started almost three years ago. It sought the SEC’s permission to use the share class in July 2023 after Vanguard’s patent on the unique structure had expired.Tax efficiency and lower fees are driving money into ETFs, and their adoption by investors is the main motivation behind adding an ETF share class to an existing mutual fund. Such share classes can use in-kind redemptions to purge potential capital gains. The redemptions can be used on all assets in a fund, not just those attributed to the ETF share class. All investors in a fund benefit from the ETF’s tax efficiency, whether they own mutual fund shares or ETF shares.ETF share classes can also help mutual fund investors move into ETFs without selling their mutual fund shares and incurring capital gains taxes. Dimensional plans to process those transfers manually until an industrywide solution is available later this year. Sorting out the mechanics of these transfers has been one of the bottlenecks to creating ETF share classes.DFA US Micro Cap ETF is the first of 13 ETF share classes that Dimensional is attempting to attach to existing mutual funds. The remaining 12 funds should receive their ETF share classes soon. Dimensional expects to have a handful of them trading on exchanges by the end of the year. The net expense ratios charged to investors of Dimensional’s ETF share classes are expected to closely match those of the existing mutual fund shares, so investors can choose the most appropriate vehicle without worrying about costs.More ETF share classes are expected to hit exchanges in the coming years. An additional 97 asset managers have requested the SEC’s permission to use the structure, and a handful of those have already filed paperwork to add an ETF share class to a specific mutual fund.