Although most digital video editing systems allow for multiple layers of realtime video, it is necessary to render that video at some point in your workflow. It's important to understand the best video render strategy for your needs.
Whether you edit on Adobe Premiere Pro, Apple Final Cut Pro or Avid Media Composer, your video needs to be rendered, when it comes time to archive your video. Rendering allows you to contain all of the video layers in a single video stream.
Since most of what I do has to get out of the system as a file at some point, I prefer to render my topmost track. Not only does this prepare for an export, but rendering the topmost track, means the video is re-compressed only once. If I render a lower track first and then the track above it, the system has to compress the composite twice.