How Can I Beat the S&P 500? What the Evidence Says
The honest answer to the most asked question in investing: how many people beat the index, why it is so hard, why investors trail even their own funds, and how daily market context fits in.
ETFsInsight
DFAS ETF vs the S&P 500: Returns, Risk and Crash History
Dimensional U.S. Small Cap ETF (market value $14.6 billion): how it compared with the S&P 500, how it behaved in every crash since 2008, its risk‑adjusted returns. Returns to Oct 30, 2026.
Key takeaways
- DFAS returned +42.3% over the 5 years to Oct 30, 2026 versus +75.9% for the S&P 500: it lagged the index.
- Its 5-year Sharpe ratio was 0.27 against 0.58 for the S&P 500.
- Its deepest crisis drawdown was −23.6% in the 2022 inflation bear market (S&P 500: −25.4%).
- Five‑year volatility was 20.5% and beta 1.03.
What is your own portfolio exposed to? Check it with Exent →
In this article
- Did DFAS beat the S&P 500?
- Is DFAS good for retirement?
- DFAS returns by year vs the S&P 500
- DFAS risk-adjusted returns: Sharpe, Sortino and volatility
- How DFAS behaved in past crashes
- What moves with DFAS, and what doesn’t
- What does DFAS hold?
- The right benchmark for DFAS
- Other popular ETFs
- Data and methodology
Did DFAS beat the S&P 500?
Over the 5 years to Oct 30, 2026, Dimensional U.S. Small Cap ETF (DFAS) returned +42.3% including dividends, versus +75.9% for the S&P 500 (SPY). It lagged the index by 33.6 percentage points, or +7.3% a year against +12.0%.
| Period | DFAS | S&P 500 | DFAS per year | S&P 500 per year | Result |
|---|---|---|---|---|---|
| 1 year | +18.5% | +12.0% | +18.5% | +12.0% | Beat |
| 3 years | +65.8% | +87.4% | +18.4% | +23.3% | Lagged |
| 5 years | +42.3% | +75.9% | +7.3% | +12.0% | Lagged |
| Period | 1 year | 3 years | 5 years |
|---|---|---|---|
| DFAS | +18.5% | +65.8% | +42.3% |
| S&P 500 | +12.0% | +87.4% | +75.9% |
| DFAS per year | +18.5% | +18.4% | +7.3% |
| S&P 500 per year | +12.0% | +23.3% | +12.0% |
| Result | Beat | Lagged | Lagged |
Total return with dividends reinvested, from month-end prices to Oct 30, 2026. Beating the index on raw return is only half the story: the next section adjusts for the risk taken. See also how to beat the S&P 500.
Is DFAS good for retirement?
DFAS can be a core retirement holding. It is Dimensional’s active, systematic US small-cap fund. A broad small-cap fund (about 2,000 stocks) with tilts away from expensive, unprofitable and recently weak stocks; a small-cap sleeve, not a whole portfolio.
Pros
- Converted from a tax-managed mutual fund in 2021 and managed to limit realized gains (Dimensional).
Cons
- 0.31% versus 0.03% for VB; the tilt has to earn its fee.
- Small caps as a group lagged large caps over the last five years.
When it is the wrong choice: If you cannot explain why you pay ten times the index fee: the case rests on factor research you should be comfortable with.
Similar ETFs to compare
| ETF | Expense ratio | Why consider it |
|---|---|---|
| DFAS | 0.31% | this fund |
| VB | 0.03% | index small cap |
| IJR | 0.06% | S&P 600 with an earnings screen |
| AVUV | 0.25% | stronger value tilt |
Fits: Retirement ETFs in your 30s and 40s · ETFs for a Roth IRA. How to choose: Best ETFs for Retirement in 2026: How to Choose by Age and Situation.
Source: the fund’s active strategy and mechanics were checked on the Dimensional DFAS fund page on Oct 25, 2026. Expense ratios are Exent market data as of Oct 25, 2026; returns and drawdowns quoted here are 5‑year monthly total returns to September 30, 2026 (Exent market data). Educational, not a recommendation for your situation.
DFAS returns by year vs the S&P 500
DFAS beat the S&P 500 in 1 of the 4 full calendar years shown.
| Year | DFAS | S&P 500 | Difference |
|---|---|---|---|
| 2026 (to Oct 30, 2026) | +15.1% | +11.7% | +3.4% |
| 2025 | +8.2% | +17.7% | −9.5% |
| 2024 | +10.2% | +24.9% | −14.7% |
| 2023 | +17.8% | +26.2% | −8.4% |
| 2022 | −13.8% | −18.2% | +4.4% |
DFAS risk-adjusted returns: Sharpe, Sortino and volatility
Over 5 years, DFAS had a Sharpe ratio of 0.27 against 0.58 for the S&P 500, so it earned less return per unit of risk than the index. Its annualized volatility was 19.4% and its beta 1.03: it tended to move about 1.0× as much as the market.
| Metric | DFAS | S&P 500 |
|---|---|---|
| Annual return | +7.3% | +12.0% |
| Volatility (annualized) | 19.4% | 15.5% |
| Sharpe ratio | 0.27 | 0.58 |
| Sortino ratio | 0.43 | 0.91 |
| Max drawdown (month-end) | −21.9% | −23.9% |
| Beta to the S&P 500 | 1.03 | 1.00 |
How DFAS behaved in past crashes
DFAS’s deepest fall in the crises below was −23.6% in the 2022 inflation bear market, against −25.4% for the S&P 500. The last column turns that into money: what a $100,000 position would have lost from peak to trough.
| Crisis | DFAS | S&P 500 | Loss on $100,000 |
|---|---|---|---|
| 2022 inflation bear market | −23.6% | −25.4% | −$23,590 |
| 2025 tariff selloff | −21.8% | −19.0% | −$21,820 |
| Window | DFAS max drawdown |
|---|---|
| Last 1 year | −9.4% |
| Last 3 years | −26.1% |
| Last 5 years | −26.1% |
| Last 10 years | −27.3% |
Peak‑to‑trough declines from daily prices inside each crisis window. A crash replay does not predict the next crisis; it shows how much room a holding needs. Run the same replay on a whole portfolio with the crash test.
What moves with DFAS, and what doesn’t
Correlation runs from −1 (moves opposite) to +1 (moves in lockstep). Over the last 60 months of monthly returns, DFAS’s correlation with the S&P 500 was 0.82, with the Nasdaq‑100 0.64, with long Treasuries (TLT) 0.53 and with gold (GLD) 0.10.
Adding a 5% DFAS position to an S&P 500 portfolio would have moved its 5‑year volatility from 15.5% to 15.5%.
| Least correlated large caps | Correlation | Most correlated large caps | Correlation |
|---|---|---|---|
| LLY | 0.02 | PH | 0.79 |
| CRWD | 0.05 | GS | 0.79 |
| CME | 0.06 | PNC | 0.78 |
| REGN | 0.08 | USB | 0.77 |
| MRK | 0.13 | BAC | 0.76 |
Holdings that are highly correlated behave like one position in a selloff. See how to find hidden overlap.
What does DFAS hold?
As of Oct 20, 2026, DFAS held 2,090 positions; its 10 largest made up 2.7% of the fund. The largest was SWKS (Skyworks Solutions, Inc.) at 0.32%.
| Holding | Name | Weight |
|---|---|---|
| SWKS | Skyworks Solutions, Inc. | 0.32% |
| HALO | Halozyme Therapeutics, Inc. | 0.31% |
| MOG-A | Moog Inc. | 0.28% |
| AIT | Applied Industrial Technologies, Inc. | 0.28% |
| WCC | WESCO International, Inc. | 0.27% |
| IESC | IES Holdings, Inc. | 0.26% |
| AMG | Affiliated Managers Group, Inc. | 0.25% |
| ELAN | Elanco Animal Health Incorporated | 0.24% |
| SJM | The J. M. Smucker Company | 0.24% |
| BWA | BorgWarner Inc. | 0.24% |
From the fund’s latest published holdings. Overlap by weight adds up, for every stock both funds hold, the smaller of its two weights: 100% would mean the same portfolio. How much do VOO, QQQ and VTI overlap?
The right benchmark for DFAS
Exent matches every holding to the index with the most similar risk. For DFAS that is MDY. Comparing a holding with an index that carries very different risk makes good results look bad and risky ones look clever. Read why the S&P 500 is the wrong benchmark for most portfolios.
Other popular ETFs
| Ticker | Name | 5‑year return | Volatility (5y) |
|---|---|---|---|
| VTI | Vanguard Total Stock Market Index Fund ETF Shares | +68.1% | 17.4% |
| VOO | Vanguard S&P 500 ETF | +76.5% | 16.8% |
| IVV | iShares Core S&P 500 ETF | +76.5% | 16.9% |
| SPY | State Street SPDR S&P 500 ETF Trust | +75.9% | 17.0% |
| 1557.T | SPDR S&P 500 ETF Trust | +78.6% | 20.8% |
| VXUS | Vanguard Total Intl Stock Idx Fund | +47.5% | 16.0% |
| QQQ | Invesco QQQ Trust | +84.3% | 22.3% |
| VUG | Vanguard Growth Index Fund ETF Shares | +66.9% | 22.2% |
Data and methodology
Returns are total returns from month‑end adjusted closing prices (dividends reinvested) through Oct 30, 2026. Crisis drawdowns and trailing maximum drawdowns use daily prices. Analyst coverage counts ratings published in the last 12 months, shown with a 30‑day delay. Full method: Exent methodology.
Holdings and weights are the fund’s latest published holdings; ETF overlap compares those holdings stock by stock.
Past performance does not guarantee future results. Historical figures are calculated by Exent from market data and are for education only; they are not investment advice or a recommendation to buy or sell any security.
See what DFAS does to your own portfolio
- Upload a screenshot of your holdings (or a CSV, Excel, PDF or Google Sheet); no brokerage login.
- Exent replays your whole portfolio, DFAS included, through the 2008, 2018, 2020, 2022 and 2025 selloffs and shows which holdings drive the losses.
- It finds holdings that move together with DFAS and compares your portfolio with a risk‑matched benchmark, Sharpe and Sortino included.
- Use the what‑if simulator to change weights and see the effect before you trade.
Frequently asked questions
DFAS can be a core retirement holding. It is Dimensional’s active, systematic US small-cap fund. A broad small-cap fund (about 2,000 stocks) with tilts away from expensive, unprofitable and recently weak stocks; a small-cap sleeve, not a whole portfolio. It is a poor fit if you cannot explain why you pay ten times the index fee: the case rests on factor research you should be comfortable with.
DFAS charges 0.31% a year. Lower-cost ETFs to compare: VB at 0.03% (index small cap); IJR at 0.06% (S&P 600 with an earnings screen); AVUV at 0.25% (stronger value tilt). Expense ratios as of Oct 25, 2026 (issuer data where available, otherwise Exent market data); check that the exposure, not just the fee, matches what you want.
No. DFAS returned +42.3% (+7.3% a year) over the 5 years to Oct 30, 2026, versus +75.9% (+12.0% a year) for the S&P 500, including dividends.
DFAS fell −23.6% from peak to trough during the 2022 inflation bear market, versus −25.4% for the S&P 500.
Over the 5 years to Oct 30, 2026, DFAS’s Sharpe ratio was 0.27 and its Sortino ratio 0.43, versus 0.58 and 0.91 for the S&P 500.
DFAS’s 5‑year annualized volatility was 20.5%, higher than the S&P 500’s 17.0%, with a beta of 1.03.
Among large US stocks, the lowest correlations with DFAS over the last 60 months were LLY (0.02), CRWD (0.05), CME (0.06). Its correlation with long Treasuries (TLT) was 0.53 and with gold (GLD) 0.10.
Sources
- Dimensional - US Small Cap ETF (DFAS) fund page — Dimensional, Oct 25, 2026
What would DFAS do to your portfolio?
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Educational content, not investment advice. Examples are illustrative; past performance does not guarantee future results.