Bank's ETF Portfolio Revamp
Midwest Heritage Bank Elevates DFAC to Largest Holding, Adjusts Other ETF Investments in Q1
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Key Points
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DFAC’s market/price snapshot: the ETF opened at $44.20 on Friday and was reported with a market cap of $46.35 billion, a P/E of 20.75, and a beta of 0.98; it also cited a 52-week range of $34.46 to $44.71, with 50-day and 200-day simple moving averages of $43.01 and $41.12, respectively.
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Beyond Midwest Heritage Bank FSB, other investors also added to DFGP: for example, Beaird Harris Wealth Management LLC increased its DFGP stake by 54.4% in the 4th quarter to 427,954 shares (about $23.139 million after buying an additional 150,747 shares).
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SPYM details not in the summary: SPYM opened at $87.89 on Friday; the report lists 50-day and 200-day simple moving averages of $85.99 and $82.09, and a 52-week range of $69.84 to $89.52. It also stated SPYM represented about 2.1% of Midwest Heritage Bank FSB’s holdings and was its 15th-largest position.
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SHY context with named peers: the report said Midwest Heritage Bank FSB’s SHY position was about 2.7% of its portfolio and its 11th-largest holding; it also highlighted large SHY increases by other institutions, including Northwestern Mutual Wealth Management Co. boosting its stake by 387.2% (to 5,292,811 shares) in the 4th quarter and Captrust Financial Advisors lifting holdings by 58.5% (to 17,024,325 shares).
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DFAC peer activity with named investors: the report cited Mercer Global Advisors Inc. ADV increasing DFAC by 5.1% in the 4th quarter to 64,358,203 shares (valued at $2,547,944,000), alongside Focus Partners Wealth adding 0.4% to 42,704,909 shares and Forum Financial Management LP rising 2.6% to 41,068,700 shares.
Midwest Heritage Bank FSB made a bold bet on factor-based investing in the first quarter, boosting its stake in the Dimensional U.S. Core Equity 2 ETF (DFAC) by 3.3% to 1,276,183 shares. The position is now worth roughly $49.6 million and sits at 15.9% of the bank's total portfolio — its single largest holding, according to Watchlist News.
The move is part of a broader portfolio shift away from plain S&P 500 indexing and toward Dimensional Fund Advisors' factor-tilted strategies, while also stacking up on short-duration bonds. DFAC opened at $44.20 on Friday, near its 52-week high of $44.71, with a market cap of $46.35 billion.
Bank Doubles Down on Factor Equity and Global Bonds
Midwest Heritage added 41,084 shares to its DFAC position in Q1. DFAC is not a plain index fund. It tilts toward smaller, cheaper, and more profitable companies — a strategy known as "factor investing" — rather than simply tracking market-cap-weighted giants like those in the S&P 500. The ETF carries a beta of 0.98 and a P/E ratio of 20.75, according to Watchlist News.
The bank also pushed deeper into fixed income. It raised its stake in the Dimensional Global Core Plus Fixed Income ETF (DFGP) by 27.6%, bringing it to 345,985 shares worth about $18.7 million — now 6.0% of the portfolio. That global bond tilt signals a move away from a strictly U.S.-focused bond strategy toward broader international diversification.
Bank Trims S&P 500 Exposure While Stacking Short-Term Treasuries
While buying into factor funds, the bank cut its position in the State Street SPDR Portfolio S&P 500 ETF (SPYM) by 7.9%, dropping 7,428 shares to 86,236. The SPYM position is now worth about $6.6 million — just 2.1% of the portfolio and its 15th-largest holding. SPYM opened at $87.89 on Friday and sits in a 52-week range of $69.84 to $89.52.
At the same time, the bank lifted its stake in the iShares 1–3 Year Treasury Bond ETF (SHY) by 23.2% to 100,955 shares, worth around $8.3 million and about 2.7% of holdings. Short-term Treasuries capture high yields without the risk of long-dated bonds falling in price if interest rates stay elevated. Analysts describe this as a classic "higher-for-longer" rate play.
Big Institutions Are Making the Same SHY and DFAC Bets
Midwest Heritage is not alone. In Q4 2023, Northwestern Mutual Wealth Management Co. grew its SHY stake by a staggering 387.2%, reaching 5,292,811 shares. Captrust Financial Advisors holds an even larger 17,024,325 shares of SHY after boosting its position by 58.5%. Both moves point to a broad institutional push into short-duration safety.
On the equity side, Mercer Global Advisors Inc. ADV holds 64,358,203 shares of DFAC — valued at roughly $2.55 billion — after raising its stake by 5.1% in Q4. Focus Partners Wealth and Forum Financial Management LP also added to DFAC, holding 42,704,909 and 41,068,700 shares respectively. Beaird Harris Wealth Management LLC boosted its DFGP position by 54.4% to 427,954 shares worth about $23.1 million.
Hy-Vee's Bank Builds a Sophisticated Wealth Engine
Midwest Heritage Bank FSB is not a typical community bank. It is a wholly owned subsidiary of Hy-Vee, Inc., the Midwest grocery chain. The bank runs kiosks inside roughly 210 Hy-Vee grocery stores, pulling retail customers into wealth management accounts. Its Q1 portfolio moves show it managing that client money with institutional-grade precision.
The bank's strategy carries some risk. DFAC tilts toward smaller and value-oriented stocks. If mega-cap tech stocks keep driving market returns — as they have in recent AI-fueled rallies — DFAC could lag a plain S&P 500 index fund. Still, Morningstar analysts have noted that DFAC's low 3% annual turnover and factor premiums give long-term investors strong reason to stay the course.
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