From Stocks to Bonds: 10 Essential Portfolio Balancing Techniques
Published Monday August 28 2023 by Michael Hoffman
4. Rebalancing
Portfolio rebalancing is the process of adjusting your current asset allocation to align with your original investment strategy. This often involves selling high-performing assets and buying underperforming ones to maintain the desired balance.
Rebalancing can help you stick to your investment plan and avoid the emotional pitfalls that come with market fluctuations. It’s advisable to set a specific time or trigger for rebalancing, such as annually or when your allocation drifts by a certain percentage.