Author Topic: Approximating total stock market  (Read 2777 times)

Miskatonic

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Approximating total stock market
« on: June 06, 2016, 01:59:30 PM »
Is attempting to approximate the total stock market worth the effort if you don't have access to VTSAX or similar?

My job's 457 has access to the following:

Vanguard Institutional Index Fund - Institutional Shares, VINIX, 0.04% ER
Vanguard Extended Market Index Fund - Institutional Shares, VIEIX, 0.08% ER
Vanguard Small-Cap Index Fund - Admiral Shares, VSMAX, 0.09% ER

I'm currently only in VINIX for my US equities. According to the linked article, I should go 81% VINIX and 19% VIEIX to approximate the total stock market. I could also go 82% VINIX / 18% VSMAX, but VSMAX is less diversified and has a higher ER than VIEIX. If I'm doing one or the other, it will be the former. Would you bother to approximate, or stick with VINIX alone? Why or why not?

forummm

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Re: Approximating total stock market
« Reply #1 on: June 06, 2016, 02:05:18 PM »
If you want VTSAX equivalent, do 80/20 VINIX/VIEIX. Sounds good to me--it's what I'd do. Midcaps are excluded from VSMAX.

dougules

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Re: Approximating total stock market
« Reply #2 on: June 06, 2016, 02:07:05 PM »
Seems like a good idea to me.  I don't know the numbers but 81/19 sounds right since the S&P 500 covers most of the total US market cap.  I think if you went with just all VINIX, though, it wouldn't make a huge difference.  It might be easier. 

Do you have any international options, too?

Miskatonic

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Re: Approximating total stock market
« Reply #3 on: June 06, 2016, 02:24:56 PM »
Yes, the international portion of my portfolio is Vanguard Total International Institutional Shares, VTSNX, 0.10% ER. For bonds I have VBTIX.

Nothing else is worth considering, except maybe the target retirement funds. I just like eking out the lowest possible ER and as long as I have access to institutional shares, I'm taking advantage of them.

seattlecyclone

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Re: Approximating total stock market
« Reply #4 on: June 06, 2016, 02:26:33 PM »
I do the VINIX/VIEIX combo. Why not? I would buy the total market in one fund if it was offered, but it isn't so I do the next best thing.

dougules

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Re: Approximating total stock market
« Reply #5 on: June 06, 2016, 03:13:56 PM »
Yes, the international portion of my portfolio is Vanguard Total International Institutional Shares, VTSNX, 0.10% ER. For bonds I have VBTIX.

Nothing else is worth considering, except maybe the target retirement funds. I just like eking out the lowest possible ER and as long as I have access to institutional shares, I'm taking advantage of them.

I would buy VTSNX, too.  How much depends on your philosophy about diversifying to international, but I would definitely buy at least a little. 

I don't really care for target funds.  I think they get too heavy on bonds, and they're also usually a bit expensive