Vanguard is highlighting its growing range of ETF products, timing the launch of a low-cost dividend appreciation fund to coincide with the SEC registration of two mid-cap equity index funds. The three additions -- the Vanguard Dividend Appreciation Index Fund, the Vanguard Mid-Cap Value Index Fund, and the Vanguard Mid-Cap Growth Index Fund -- were announced Thursday.

"We are committed to expanding our suite of ETFs to include broad market, style, sector, and specialty funds with costs that are considerably lower than many competing products," said company CIO Gus Sauter in a statement.

Vanguard has sold ETFs since 2001, but its ETF assets increased by over 92 percent in 2005. With these new offerings, the firm's selection of ETFs includes 26 funds, which encompassed $15 billion in assets in both domestic and international markets as of March 31, 2006.

All the new funds feature both traditional investor shares and exchange traded shares.

The Vanguard Dividend Appreciation Index Fund -- which tracks the Mergent Dividend Achievers Select Index, a market-capitalization weighted index of stocks that have historically yielded increasing dividends -- began trading on the AMEX Thursday morning at an expense ratio of 0.28 percent for exchange traded shares. Vanguard said this is the lowest cost for any dividend-oriented ETF available.The minimum initial investment for investor shares is $3,000 for taxable accounts, IRAs, and custodial accounts for minors, and $2,000 for education savings accounts.

Vanguard Quantitative Equity Group serves as manager of the Dividend Appreciation Index Fund, and will oversee the Vanguard Mid-Cap Value Index Fund and the Vanguard Mid-Cap Growth Index Fund.

Vanguard Mid-Cap Value Index Fund will seek to track the performance of the MSCI US Mid Cap Value Index, and the Vanguard Mid-Cap Growth Index Fund will seek to track the performance of the MSCI US Mid Cap Growth Index. Investor shares in both funds will have an initial minimum investment of $3,000 and are expected to be available to investors in the third quarter of 2006, pending SEC review.  

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