When most investors think about index funds, the first name that likely comes to mind is Vanguard--and for good reason. Vanguard's history is built around the index fund concept--the company bravely launched over 30 years ago the first retail index fund based on the S&P 500 Index (ironically dubbed "Bogle's folly" at the time after firm founder John Bogle). Vanguard's rock-bottom index fund fees--one of the primary advantages of passively managed funds--are also laudable.
But Vanguard's dominance over the index-investing landscape has overshadowed some worthy players. Dimensional Fund Advisors, for instance, is a much smaller shop than Vanguard, but it provides plenty of appealing index fund choices. In fact, the index options at DFA outnumber the offerings at Vanguard. And DFA offers a more exotic array of choices, such as Emerging Markets Social Core Equity (DFESX) and U.S. Sustainability Core (DFSIX), whereas Vanguard tends to stick with plain-vanilla indexes such as the S&P 500 Index and other commonly known market indexes.
Another lesser-known player that offers solid index choices is Bridgeway. This interesting, shareholder-friendly shop is smaller than DFA, but that doesn't limit its appeal. Bridgeway has 11 funds--mostly quantitatively run; two of which are index funds. Bridgeway's ability to be nimble in the micro-cap space is an advantage especially over behemoths such as Vanguard or Fidelity whose enormous size limits their ability to operate as smoothly.
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Greg Brown does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.