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DFA California Short-Term Municipal Bond Portfolio

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Inception Date April 2, 2007

Ticker Symbol DFCMX

CUSIP Number 233-203-330

The investment objective of the DFA California Short-Term Municipal Bond Portfolio is to provide current income that is expected to be exempt from federal personal income taxes and California state personal income taxes. The Portfolio seeks to maximize total returns from a universe of municipal securities primarily issued by or on behalf of California state or local governments and their agencies, instrumentalities and regional governmental authorities, the interest on which is exempt from regular federal income tax and the state personal income tax of California. The Portfolio will have an average dollar-weighted portfolio maturity of three years or less. The Portfolio is primarily designed for investment by California taxpayers.

For a full description, please consult the Portfolio's prospectus.

View proxy vote filings.

Market Risk
Even a long-term investment approach cannot guarantee a profit. Economic, political, and issuer-specific events will cause the value of securities, and the funds that own them, to rise or fall. Because the value of your investment in a fund will fluctuate, there is a risk that you will lose money.

Interest Rate Risk
Fixed income securities are subject to interest rate risk because the prices of fixed income securities tend to move in the opposite direction of interest rates. In general, fixed income securities with longer maturities are more sensitive to these price changes.

Credit Risk
Credit risk is the risk that the issuer of a security may be unable to make interest payments and/or repay principal when due. A downgrade to an issuer's credit rating or a perceived change in an issuer's financial strength may affect a security's value, and thus, impact a fund's performance. Credit risk is greater for fixed income securities with ratings below investment grade. Fixed income securities that are below investment grade involve high credit risk and are considered speculative. Below-investment grade fixed income securities may also fluctuate in value more than higher-quality fixed income securities.

Income Risk
Income risk is the risk that falling interest rates will cause the fund's income to decline.

Call Risk
Call risk is the risk that during periods of falling interest rates, a bond issuer will call or repay a higher-yielding bond before its maturity date, forcing the fund to reinvest in bonds with lower interest rates than the original obligations.

Tax Liability Risk
Tax liability risk is the risk that distributions by the fund become taxable to shareholders as ordinary income due to noncompliant conduct by a municipal bond issuer, changes in federal or state tax laws, or adverse interpretations of tax laws by the Internal Revenue Service or state tax authorities.

State-Specific Risk
Because the Portfolio focuses its investments primarily in California municipal securities, the value of the Portfolio's investments will be highly sensitive to events affecting the fiscal stability of the State of California and its agencies, municipalities, authorities and other instrumentalities that issue securities. These events may include state or local legislation or policy changes, state constitutional limits on tax increases, erosion of the tax base of the state or one or more particular localities, the effects of possible terrorist acts or natural disasters, budget deficits, or other economic or credit problems affecting the state generally or any individual locality or industry.

Non-Diversification Risk
The risk that the fund may be more volatile than a diversified fund because it invests its assets in a smaller number of issuers. The gains or losses on a single security may, therefore, have a greater impact on the fund's net asset value.