The Goldman Sachs Group Inc. made its debut managing exchange-traded funds Monday when its asset-management unit launched the first in a series of relatively low-cost index funds.

Goldman is offering the new fund, the ActiveBeta U.S. Large Cap Equity ETF (GSLC), at 0.09% of assets annually, a low figure even by the competitive pricing standards of the ETF business. That’s less than the average of 0.49% for equity “strategic beta” funds tracked by Morningstar Inc., including the 0.15% charged by Vanguard for its S&P 500 Value ETF (VOOV).

And the firm has launched itself into the middle of an intense competition by traditional active money managers, including JPMorgan Chase & Co., OppenheimerFunds and Legg Mason Inc., many of whom watched from the sidelines as financial advisers and other investors snapped up index-based ETFs. The funds are responsible for nearly $3 trillion in assets globally.

Those firms have struggled to gain traction for active management in that particular market. And many have started to use exotic indexes, often called smart beta, to attract investors. Unlike other exchange-traded funds that try to track the performance of entire financial markets, like S&P 500 index funds, Goldman Sachs Asset Management has built an index that attempts to outperform the market.

Todd Rosenbluth, director of ETF & mutual fund research at S&P Capital IQ, said the fund faces an uphill climb despite potentially strong interest in the fund and its low cost.

“Investors have primarily put assets into the ETFs of much more established ETF providers, such as iShares, Vanguard, State Street and WisdomTree,” said Mr. Rosenbluth. “It is hard for a new firm to get traction on their own.”

RULES-BASED STOCK PICKING

Goldman’s ActiveBeta index relies on a set of rules to pick stocks. Goldman said its methodology selects undervalued companies with upward price momentum, sustainable profits and less exposure to violent price swings. It plans additional funds on the same theme “in the coming months,” the firm said in a statement.

Goldman’s existing asset-management business, responsible for $1 trillion, includes its alternative investments-focused mutual fund business as well as hedge funds and private equity.

Just this year, Legg Mason has disclosed plans for their first ETFs, while OppenheimerFunds announced plans to acquire VTL Associates, the firm responsible for RevenueShares, another ETF brand.