REWahoo
Give me a museum and I'll fill it. (Picasso) Give
I'm no longer an indexer so I have no dog in this fight, but thought this was an interesting look at why all indexes are not created equal and how the lowest cost might not be the best way to choose an index fund:
Saving a few pennies on index funds could cost you many dollars
More important are the benchmark the fund follows, tracking error and tax efficiency - and new funds like Fidelity's zero expense ratio funds are less tax efficient than funds with a longer track record.
Saving a few pennies on index funds could cost you many dollars
We can all celebrate the competition between index providers that has brought expenses as low as they now are. But one consequence of these low ratios is that they no longer are near the top of the list of factors we should take into account when choosing an index fund.
More important are the benchmark the fund follows, tracking error and tax efficiency - and new funds like Fidelity's zero expense ratio funds are less tax efficient than funds with a longer track record.