SEC Set to Allow Dimensional to Offer Dual Share Class Funds (1)

The US Securities and Exchange Commission intends to grant Dimensional Fund Advisors the ability to offer ETFs as share classes of mutual funds, opening the door for widespread use of a tax-saving structure previously exclusive to Vanguard Group.

The decision is a potential watershed moment for US money managers, more than 70 of which have sought permission from the SEC to adopt the dual-class structure. ETFs have become the investment vehicle of choice for Americans over the last decade thanks to their favorable tax status and ease of use. They’ve attracted trillions of dollars in inflows while mutual funds bled ...