Fund Openings, Closings, Manager Moves: TIAA-CREF to Launch Five Funds

TIAA-CREF, the giant teachers' pension fund manager, will nearly double its retail mutual fund lineup next month with the introduction of five stock and bond funds.

Like its six existing mutual funds, TIAA-CREF's new funds boast low annual expenses, though they're not quite as low as those of low-cost fund rival Vanguard.

The new funds will be launched on or about April 3, depending on when their paperwork is approved by the Securities and Exchange Commission.

Two are stock funds: Equity Index and Social Choice Equity. Equity Index will track the Russell 3000 a broad-based index including 3000 of the largest U.S. companies based on market capitalization. The fund will charge a miniscule 0.26% in annual expenses. The (VTSMX)Vanguard Total Market index, which tracks the Wilshire 5000, charges just 0.2% annually.

Social Choice will invest in S&P 500 stocks that don't damage the environment, manufacture weapons, produce or market alcohol or tobacco, produce nuclear power, have Northern Ireland operations or fail to follow equitable hiring practices. The fund's expense ratio is just 0.27%, but Vanguard says it plans to offer a socially conscious fund that charges just 0.25%.

TIAA-CREF's three new bond funds will be Short-Term Bond, High-Yield Bond and Tax-Exempt Bond. They'll have annual expenses of 0.3%, 0.34%, and 0.30%, respectively. Vanguard offers a comparable product in each category with slightly lower annual expenses.

Though they don't beat Vanguard on cost, there are still reasons to consider the new funds. TIAA-CREF, which stands for Teachers Insurance and Annuity Association-College Retirement Equities Fund, has quietly and effectively managed money for professors and other educators for more than 80 years and has more than $290 billion under management. For more on the funds, see this Dear Dagen column.

See Tuesday's Fund Openings, Closings, Manager Moves.

See Monday's Fund Openings, Closings, Manager Moves.

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