“Smart beta” is the latest investing fad

Vanguard, told the Bogleheads last month that many "smart beta" products favor small companies and stocks with bargain prices, which studies suggest may deliver higher returns over time.

If investors want to tilt in that direction, he said they should "do it intentionally"—and more cheaply—by adding conventional small-cap or value index funds to their portfolios.

Joel Dickson, a senior investment strategist in Vanguard’s Investment Strategy Group, said strategies that involve overweighting particular factors look a lot like active management "cloaked in index Halloween costumes."

Investors could think of it as "faux-dexing," he quipped.