Investing in Markets and Local Communities
David Booth, the founder of Dimensional Fund Advisors and a prominent benefactor for the University of Kansas, released a new book titled "Stay Calm" this September. During his return to Lawrence, Kansas, Booth framed his investment philosophy around the concept of staying the course. He argues that nervous investors often lose potential gains by reacting to market dips with panic-selling rather than trusting in long-term data. For Booth, the core of financial wisdom is to stop attempting to outsmart the market through active stock picking.
His perspective aligns with research on the "efficient market hypothesis," which suggests that professional managers struggle to consistently beat the market. During his time at the University of Chicago starting in 1969, Booth refined the view that index investing provides a more reliable path for individuals. He notes that the market performs the heavy lifting for the investor by incorporating the collective intelligence of countless buyers and sellers. Any individual attempt to outmaneuver this system through active trading often fails to account for the high level of competition present in global finance.
The Role of Trust in Execution
Booth’s presence in Lawrence was not limited to book promotion. He held a panel discussion at the conference center within the David Booth Kansas Memorial Stadium, joined by Hall of Fame basketball coach Bill Self and former player Mario Chalmers. The conversation bridged the gap between financial discipline and the sports world. Coach Self noted that he moved away from micromanaging his players after realizing that successful outcomes rely on trusting talent rather than forcing rigid plays. Booth mirrored this sentiment, emphasizing that his financial decisions remain rooted in the quality of the process rather than the immediate result of a single trade.
Trust also defines his relationship with the University of Kansas. His financial support, which includes a notable $300 million donation announced in 2025, is directed toward infrastructure and the university's adaptation to changing athletic conference rules. Booth explains that his initial gifts required a level of "blind optimism" given the university's past struggles in football. However, the subsequent transformation of the athletic program and the execution of the Gateway project—a development encompassing student housing and retail space—solidified his confidence in the current leadership under Chancellor Doug Girod.
Broadening the Definition of Wealth
Beyond financial markets and football stadiums, Booth considers his relationship with Lawrence a critical component of his personal success. He recalls selling popcorn at games and working in libraries during his youth, experiences that grounded his understanding of community. While his career took him to Austin, Texas, he views his philanthropic efforts as a form of payback to the institution that provided his early foundation. He suggests that this connection is what makes smaller university towns distinct from anonymous urban centers.
Booth’s focus remains on the idea of "true wealth," which he defines through the lens of human ingenuity. He rejects the notion that market volatility is a sign of long-term failure, pointing to historical data from the Great Depression to the 2020 pandemic as proof that systems recover. He believes that "Stay Calm" serves as a practical guide for those overwhelmed by modern anxieties. By choosing to stay invested, both in financial markets and in the growth of specific institutions like KU, Booth advocates for a long-term approach to life that values execution over speculation. His vision for the future rests on the belief that regardless of the era, human beings will continue to innovate and improve their circumstances.