ING) that sells 401(k) plans to small businesses, has provided ETF-based vehicles for four years. Vanguard Group, the third-largest provider of ETFs, uses index mutual funds for its own 401(k) offerings, but has marketed ETFs to other plans for several years. In 2007, WisdomTree Investments ( WSDT) created a business unit designed to deliver ETFs to the 401(k) marketplace. In all, the company sells 52 funds. Small businesses have been early adopters of ETFs in their retirement plans because of lower costs. That trend may continue until larger companies join the fray. When that happens, mutual funds' dominance may slip quickly.
-- Reported by Joe Mont in Boston.