Most of the major players have funds with expense ratios within a couple basis points of each other. When they're that close, picking the fund with the lowest e

Most of the major players have funds with expense ratios within a couple basis points of each other. When they're that close, picking the fund with the lowest expense ratio may not result in the best performance and other factors can dominate: - How well the fund is run, and how representative it is of the index. A fund with high trading costs may underperform. - Securities Lending policy, how risky it is and how much of the income is returned to the fund - (In taxable accounts) Tax efficiency. Some funds from some vendors return a significant amount of capital gains and short-term dividends, which can cost several basis points in taxes a year. In general, the first two elements can be approximated by comparing the performance of the fund to its benchmark over the same time period, and tax efficiency can be estimated by looking at details of past distributions. In most cases, it wouldn't make sense to switch existing funds to another provider in a taxable account if switching would result in a large capital gain. I'd expect all providers to get better at indexing over time and their performance after taxes to converge.