One of the key issues in structuring an asset allocation strategy is deciding how to divide up the world’s equity markets. Everyone has an opinion, but it’s usually best to start with the standard benchmark, otherwise known as relative market values based on capitalization. You may choose to second guess Mr. Market’s equity allocation, but you should at least have an idea of what you’re modifying, if only for perspective. Are you making a big bet in Asia vs. Europe? Is your US allocation hefty vs. foreign developed markets? Are you underweight Japan vs. the rest of Asia? Knowing the answers to these type of questions isn’t a silver bullet, but as a general rule it’s useful to know how your choices on risk factors compare before you start reshuffling the market portfolio. Indeed, the information on relative market caps may end up informing your decisions on how to customize a portfolio.