The Biggest Fund You Never Heard Of

Pension heavyweight TIAA-CREF is retailing mutual funds

For years, the Vanguard Group has preached the gospel of low costs to mutual-fund investors. As its simple message has caught on, Vanguard has become the nation's second-largest and fastest-growing fund firm. Now, a new rival, known by the unwieldy acronym TIAA-CREF, is challenging this colossus with a low-cost message refined over eight decades of managing pension funds for colleges, universities, and nonprofits. "No one has ever competed successfully with Vanguard," says Burton J. Greenwald, a Philadelphia mutual-fund consultant. "Now, for the first time, there is a competitor with enormous credibility."

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