David Booth. Dimensional Fund Advisors
Each trader and manager strives for individuality, developing his own strategies and investment schemes, a set of rules.
However, in order to achieve success on the stock exchange, there is no need to strive to create something new, because there are thousands of traders on the market whose algorithm works successfully and demonstrates profitability.
Perhaps it would be easier to take a ready-made concept of a successful investor and strictly follow it? Many will not agree with this statement and will continue to look for something of their own.
At the same time, the biography of David Booth, owner of Dimensional Fund Advisors, proves that with proper borrowing, you can really achieve a lot.
David Booth's biography is not full of details from childhood, much less facts that could indicate that he was a gifted child and all his successes were predicted by fate.
In fact, Booth is an extremely systematic and consistent person, and his biography does not stand out in any bright colors, with the exception of the last years of his life.
Training and Career
David Booth was very attracted to science and research activities. As a child, he graduated from the local Lawrence High School. There in Kansas, he entered a local university, and graduated quite successfully, receiving a bachelor’s degree in finance.
He continued his studies at the same university, but received a master's degree in business administration.
Continuing his research career, he joined the University of Chicago as a doctoral student. There he had a fatal acquaintance with his academic advisor, which forever changed his idea of finance and forced him to move from theoretical knowledge to practical knowledge.
David Booth found himself under the wing of the famous economist Eugene Fama, who at that time was actively developing the theory of stock pricing, and also conducted a number of studies in order to find certain patterns of price movement.
The most interesting thing is that David Booth impressed his supervisor so much that he did everything to show his student the path to the world of finance.
Thus, thanks to Eugene, David Booth met his future partner and, in the future, the founder of Dimensional Fund Advisors, Rex Sinkefield.
The teacher also took care of his student’s first job; he sent him to John (Mac) McQuown, who founded the first index fund of that time, Wells Fargo & Co.
Gaining knowledge and experience has allowed David Booth to build an excellent team and his fund, Dimensional Fund Advisors. Nobel laureate Eugene Fama was invited as a professional, who was able to put his theory into practice.
The fact is that David Booth, through a series of studies in the field of compiling an investment portfolio, together with his manager, found out that it is best to invest in poorly capitalized companies or in undervalued assets.
By his calculations, investing in brands and leading companies did not provide the market returns that could be achieved by simply buying an industry index.
Thus, from the very beginning of the fund's operation, David Booth began actively buying shares of small-cap companies and undervalued shares, and in most cases these were non-US shares.
It was this strategy that gave excellent results, since after some time most of the purchased securities showed excellent growth. Successful activities served as the best advertising and allowed to increase the flow of investments. The fund currently manages over $450 billion.
In addition to achievements in the field of investing, David Booth actively develops science and makes donations to various fields.
So in 2008, he donated $300 million to the Chicago Graduate School of Business, and the donations came both in cash and in shares of Dimensional Fund Advisors, which will allow the university to earn dividends in the future.
At this stage, the personal wealth of this scientist-investor is estimated at more than $1.3 billion, and he continues to function as the head of Dimensional Fund Advisors to this day.