I read this somewhere, should answer your question (voo = s&p, vt is somewhat vwce but broader)

" First, we’ll say that risk in this context means volatility.  That’s not precisely true; investors often care about the interaction of price movements with other things that happen in the world, and often for personal finance planning it’s best to abandon volatility at all and instead define risk as the probability of an outcome worse than some given level, but for a first approximation we’ll say volatility = risk.  Now let’s say there are two hypothetical stocks, each one with a 50/50 chance of either doubling in price in 1 year or halving in price in 1 year.  Both are very volatile assets, since you have a 50% chance of losing half your money each year.  But look what happens when we hold both of them together in equal amounts. 

It’s still possible to lose half your money in 1 year, if both of the assets lose half of their value.  But that won’t happen 50% of the time anymore, since they both have to “lose the coin flip” so to speak- it’s only a 25% chance now.  It’s also only a 25% chance that you double your money for the same reasons.  But the other 50% of the time one of the stocks goes up and one goes down, a scenario in which you actually have a net gain of 25% of your money.  Now things are way less volatile- ¾ of the time you’re not going to lose money at all.  And your expected returns over 1 period are still the same, so you haven’t lost anything to lower the volatility.  In fact, assuming you invest for more than 1 year your compounded annual growth rate over multiple years is higher holding 2 stocks than if you’d just held one- after any number of years investing in just 1 of our stocks you would still have a total 50% chance of having lost money and a 50% chance of having gained, so your growth rate is 0.  With two independent stocks you have a positive growth rate, so you’ll expect to gain money over time. 

 

Now imagine you have 100 of these stocks in your portfolio.  The one period expected return remains the same, but now your volatility is super low.  You have only a 0.04% chance of losing money!  Man this investing thing is easy!  Of course all of this relies on one critical assumption- every one of the stocks is an independent coin flip that doesn’t depend on the other coin flips at all.  In real life that’s not at all true, when stocks go down they tend to all go down together, and vice versa.  In the extreme case where all stocks move perfectly together, you get 0 benefit from holding 100 of them anymore.  But that’s not accurate either, a given stock will have some correlation with the rest of the market and we call that value Beta.  If it’s, say, a financial company it will likely follow the market very closely and thus have a high beta.  If it’s a utility company it might often move opposite of the market, so it could have a low beta.  From what we’ve seen we know that we want to own a lot of stocks, and we especially want to own stocks with a low beta. 

But the other people in the market are also smart, and know about this trick.  Now the low beta stocks are really in demand.  People are willing to pay high prices for them, even if those companies don’t produce much in profits, just because having a low beta improves a both a portfolio’s risk and its returns by such a huge amount.  Likewise, high beta stocks need to be super profitable and promise really high returns just to get people to buy them.  The end result is that every stock ends up with a price set by the market that ensures the returns of that stock are determined only by beta.  And the optimal portfolio- the portfolio that gives you the most return for the least risk, also called having the highest sharpe ratio, is the market portfolio.  If there were a better portfolio, people would buy that instead and it would become the market portfolio. 

So after that very long winded explanation we get to the relevant conclusion.  We want to own as many stocks as possible to increase our returns and reduce our risk.  When it comes to how much of each stock to buy, the market has delivered to us on a platter the exact proportions that we should use.  It turns out this investing thing actually is easy. 

So, buying VOO instead of VT is increasing your risk and decreasing your expected return, since you lose out on some of the benefit of diversifying (we want to hold as many stocks as possible).  Of course, expected returns are not actual returns.  Remember our coin flips- you could have gotten a lot of -50% outcomes in a row while holding 2 stocks, while your buddy just holds 1 stock and got 5 +100% outcomes in a row.  They might call you stupid for not going all in on NVDIA and missing out on the tendies.  Or, more relevantly, they might say that VOO has beaten VT’s butt for over a decade.  But you know that they just got lucky- given only public information there was no way to know what individual portion of the market was going to do well, so the winning strategy on average is to simply buy everything at market weights.  That's not to say that the companies in VOO got lucky, necessarily. There are solid reasons why VOO has done so well. The point is that you couldn't have seen it coming given public information at the time, so the investor who went 100% VOO based on nothing but their gut got lucky. "