Posts  / #POST-229865
REDDIT

DFUS seems like a better solution (than VTSAX) to avoid trillion-dollar IPOs that want to sneak into Index Funds. Got any other solutions?

**What is DFUS:**

A semi-actively managed index fund that encompasses US broad market. Very similar to VTSAX but the actively managed portion of it tries to address the market inefficiencies exploited by 3rd parties like Hedge Funds (and now unprofitable trillion-dollar IPOs that want to escape price-discovery in the open market).

**How DFUS gives an added layer of protection (compared to VTSAX):**

* DFUS's value tilt mechanically underweights or excludes securities with very high price-to-book and price-to-earnings ratios
* DFUS also has a profitability screen that wouldn't allow these highly unprofitable IPOs to be automatically added
* The third and final advantage DFUS has over large indexes is it doesn't have fixed buying/selling dates - which could potentially be used by Hedge Funds to time their trades so they profit off of passive investors

**To the people in the comment section who will inevitably argue this is "nothing-burger"**

* If 0.1% of your portfolio is nothing burger, please send that my way. Thank you. 
* This is not about profit, this is about principle. I don't want any IPO skipping price-discovery phase and going straight into our retirement accounts. That's just not how capitalism should work. 

**Comparison of VTSAX vs DFUS at stock analysis:**

[https://stockanalysis.com/etf/compare/dfus-vs-mutf:vtsax/](https://stockanalysis.com/etf/compare/dfus-vs-mutf:vtsax/) (filter by last 5 years since DFUS started in 2021)

Past performance is not a guarantee of future yields. This is not financial advice. Do your Research.

**Got any other solutions? I'd like to hear them.**

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