new Vue({el:'#app'}) will instantiate a new Vue instance. It accepts an options object as a parameter. This object is central in Vue, and defines and controls data and behavior. It contains all the information needed to create Vue instances and components. In our case, we only specified the el option which accepts a selector or an element as an argument. The #app parameter is a selector that will return the element in the page with app as the identifier. For example, in a page like this:
<!DOCTYPE html> <html> <body> <div id="app"></div> </body> </html>
Everything that we will write inside the <div> with the ID as app will be under the scope of Vue.
Now, JSFiddle takes everything we write in the HTML quadrant and wraps ...
