Stay the Course: Insights from the DFA Client Reception
June 15, 2026 • By Carl Lachman, MBA, CFP®
A summary of our investment discussion between Eclectic Associates Vice President Carl Lachman and Dimensional Fund Advisors Senior Economist Apollo Lupescu on June 3, 2026.
Want to get the full conversation? Listen to the audio from our reception.
On the evening of June 3, 2026, Eclectic Associates hosted a client reception featuring Apollo Lupescu, PhD, a senior economist and educator at Dimensional Fund Advisors (DFA). With over two decades at the firm and hundreds of presentations annually, Lupescu led an engaging discussion on the questions weighing on investors' minds — among them, artificial intelligence, market valuations, geopolitical risk, and how to stay grounded when the world feels anything but.
The World Is Different, and That's OK
Lupescu opened with a candid acknowledgment: Yes, the current environment feels unprecedented, and in many ways, it is. Inflation pressures, shifting interest rates, geopolitical tensions, and the rise of AI represent a genuinely unusual confluence of forces.
But his central message was that while the situation is always changing, the fundamental premise of investing does not. Companies operating in free markets consistently adapt, innovate, and generate returns, even amid wars, energy crises, and pandemics. That enduring premise, he argued, is the investor's equivalent of the fixed rules of chess: The board changes every game, but the game itself stays the same.
He also warned that emotion is often the investor's worst enemy. When uncertainty spikes, people tend to make reactive decisions — selling at the bottom, sitting out recoveries — that damage their long-term outcomes. A sound financial plan, tailored to individual circumstances and risk tolerance, is the antidote.
Who Is Dimensional Fund Advisors?
DFA was founded in 1981 and manages over a trillion dollars globally, yet it remains deliberately outside the public spotlight. Unlike Fidelity or Vanguard, DFA has never marketed directly to retail investors. Instead, it works exclusively with large institutions and a carefully selected group of fee-only, fiduciary advisors — professionals such as Eclectic Associates who are legally obligated to act in clients' best interests and who receive no commissions from product sales.
DFA's investment philosophy is rooted in academic research, drawing on the work of economists from the University of Chicago, five of whom have received the Nobel Prize in Economics. DFA does not rely on star fund managers to pick winning stocks or time the market (what Lupescu called "conventional active management"), and does not simply replicate an index like the S&P 500. Instead, it occupies a disciplined middle ground: owning broad, globally diversified exposure and systematically tilting toward factors — particularly small-cap and value stocks — that academic research has shown to outperform over time.
The AI Opportunity: Real, but Uncertain
Much of the evening's conversation centered on artificial intelligence. Lupescu framed it as a legitimate revolution, comparable to the internet, and drew careful lessons from the comparison. When the internet emerged in the mid-1990s, nobody could have predicted that a scrappy online bookseller would become Amazon while Pets.com and eToys would vanish. The same dynamic applies to AI: The winners will be transformative, but identifying them in advance is nearly impossible.
The capital being deployed is staggering. Four companies — Microsoft, Amazon, Meta, and Google — are collectively investing in AI infrastructure at a scale second only to the Louisiana Purchase in terms of the economy's size. More than the cost of the entire U.S. highway system. More than the cost of the U.S. railroads. All in a single year. Yet these companies are not yet monetizing AI at a rate that justifies current valuations, which is why AI-linked stocks carry high price-to-earnings ratios. Tesla, for example, was trading at roughly 300 times earnings earlier this year — a payback period of three centuries at current profit levels.
Lupescu's conclusion: AI is not a bubble in the traditional sense. The potential payoff is enormous, and rational investors are pricing in future earnings. But the uncertainty is real, and no one knows which companies will capture that value. The appropriate response is broad diversification — owning the whole race, not betting on a single horse.
The Global Supply Chain Hiding in Plain Sight
One of the most illuminating moments came when Lupescu traced the AI chip supply chain. NVIDIA designs the world's most powerful AI chips, but cannot manufacture them. Only one company in the world can: TSMC, based in Taiwan. And the machines that make those chips — extraordinarily precise lithography equipment — are produced exclusively by ASML in the Netherlands.
This global interdependence, he argued, is precisely why DFA's portfolios span roughly 13,000 companies across 45 countries. Owning only Nvidia would mean missing the companies that Nvidia cannot exist without.
Concerns about Taiwan's geopolitical vulnerability were acknowledged directly. While the risk is real, Lupescu noted that TSMC's first U.S. facility is now coming online in Phoenix and that additional capacity is planned, a meaningful step toward reducing concentration risk in the global semiconductor supply chain.
Resilience as an Investment Thesis
Lupescu closed with a sweeping historical perspective.
U.S. investors who stayed the course from September 1939 through August 1945 — through six years of global war — would have roughly doubled their money. Ford built tanks. Cadillac built tank engines. Coca-Cola used military contracts to build a global distribution network that it still operates today. Companies adapt. People adapt.
The 1973–74 energy crisis felt catastrophic at the time, but it produced fuel efficiency standards, a push for energy independence, and ultimately a United States that today produces its own oil.
Crises, Lupescu suggested, often contain the seeds of the next era of growth.
The takeaway for investors: There is no reliable way to time the market, just as there is no reliable way to predict earthquakes. What you can do is prepare: Build a plan that matches your needs, timeline, and risk capacity, and then stay invested. Those who do, history suggests, are rewarded for it.
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