Some Fundamental Index Fund Choices

The first fundamentally weighted index funds distributed to retail investors have been the ETFs, which have some advantages over mutual funds. Three companies are sponsoring fundamentally weighted ETFs as this book is being written.

PowerShares Capital Management (an investment advisory firm now owned by Invesco) manages 90 ETFs (five of them broad-based domestic ETFs) is using Research Affiliates' methodology. Two that you should consider are PowerShares FTSE RAFI US 1000 (PRF), which owns approximately 1,000 stocks, and PowerShares FTSE RAFI US 1500 Small-Mid portfolio (PRFZ). See www.powershares.com (or Invescopowershares) for details.

Another company that sponsors fundamental funds is Wisdom Tree, headed by three of the biggest names in the business: Professor Jeremy Siegel (author Stocks for the Long Run), Michael Steinhardt, a famous hedge fund operator, and Arthur Levitt, a former SEC chairman.