What we believe...

One of Vanguard's bedrock investment principles is that a portfolio shouldn't vary substantially from market proportions, or "weightings." Holding proportionately more of an asset compared with the market is known as "overweighting"; holding proportionately less, "underweighting." Research suggests that investors don't consistently benefit from overweighting or underweighting parts of their portfolio.*

Differences from market weightings could reflect your investment decisions or the investment decisions of active mutual fund managers. You should be conscious of how your portfolio differs from the market and be sure that you're comfortable with those differences.

* Source: Vanguard Investment Counseling and Research ("A review of alternative approaches to equity indexing" 2011).