I'm starting to look more into asset allocation options and where I want to end up. When I started I just threw all my money at index funds, which is fine for a while, but 10 years later and I'm realizing they may have not been the best funds. The expense ratios are fine, but I was under the impression that an S&P500 index was essentially the same as Total Stock Market. But now I'm looking into different asset allocations and playing around with things on Portfolio Charts and discovering this is not the case, and would like to diversify into TSM more. Right now I'm at 80/20 domestic/international split, but like so:
Domestic S&P500 (PREIX) (Large Cap Blend?): 57%
Domestic TSM (VTSAX): 23%
International Large Cap (SWISX) (Large Cap Blend?): 8%
International TSM (VGTSX): 12%
The problem is the bulk of my LCB (domestic and intl) is in my taxable account, or in my 401k where there aren't really other options. The Vanguard funds are in my IRA(s) and I'd rather not change those since they're ultimately where I want to be. Given I'd like to diversify my equity holdings a bit more, how would you go about it?
1) Start buying small and mid cap funds to compensate for the heavy large cap weight?
2) Ignore the LC weighting and keep them and just buy TSM going forward.
3) Market's up a bit much right now to be trying to sell my taxable holdings to rebalance, but is ultimately an option.
4) Something else?
Appreciate any input.