Approximating total stock market

Investors wishing to invest in Vanguard Total Stock Market Index Fund often face a situation where they have to approximate it with the funds available in their employer sponsored plans and quite possibly some other funds available in other accounts such as a Roth IRA.

This page shows a few examples of approximating Vanguard Total Stock Market Index Fund with funds covering specific parts of the market.

Examples
{|border=1 cellpadding=7 !Funds !Morningstar Style Box
 * - style="background:#f0f0f0;"
 * 100% [Vanguard Total Stock Market Index Fund (VTSMX) (0.15%)
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 * 80% Vanguard 500 Index Fund (0.15%) 20% Vanguard Extended Market Index Fund (VEXMX) (0.24%)]]
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 * 80% Vanguard 500 Index Fund (0.15%) 20% Vanguard Extended Market Index Fund (VEXMX) (0.24%)]]
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 * 81% Vanguard 500 Index Fund(VFINX) (0.15%) 6% Vanguard Mid-Cap Index Fund (VIMSX) (0.21%) 13% Vanguard Small-Cap Index Fund (NAESX) (0.22%)
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 * 83% Vanguard 500 Index Fund (VFINX) (0.15%)]] 17% Vanguard Small-Cap Index Fund (NAESX) (0.22%)
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 * 86% Vanguard 500 Index Fund (VFINX) (0.15%)]] 14% iShares Russell 2000 Index (IWM) (0.20%)
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 * 82% Vanguard 500 Index Fund (VFINX) (0.15%)]] 11% iShares S&P MidCap 400 Index (IJH) (0.20%) 7% iShares S&P SmallCap 600 Index (IJR) (0.20%)
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 * 85% Vanguard 500 Index Fund (0.15%)]] 15% Vanguard Tax-Managed Small-Cap Fund  Inv (VTMSX) (0.13%)]]
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 * 88% Vanguard Large Cap Index Fund (VLACX) (0.20%)]] 12% Vanguard Small-Cap Index Fund  (NAESX) (0.22%)]]
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 * }
 * 85% Vanguard 500 Index Fund (0.15%)]] 15% Vanguard Tax-Managed Small-Cap Fund  Inv (VTMSX) (0.13%)]]
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 * 88% Vanguard Large Cap Index Fund (VLACX) (0.20%)]] 12% Vanguard Small-Cap Index Fund  (NAESX) (0.22%)]]
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 * }
 * }


 * These percentages were computed on Aug 16, 2008.
 * The style box numbers were computed by Morningstar Instant XRay.
 * Computation was done by the method of least squares.
 * Investors contemplating on using an S&P MidCap 400 fund, for example, may consider the example above that uses IJH. However, there may be slight implementation differences between the S&P MidCap 400 fund you have access to and IJH.
 * Two funds may appear to track the same portion of the market (say, mid-cap), but their holdings may differ depending on the indexes they track.