Wick

Rebalancing

Portfolio & Risk

Sell a little of what won

Over time the winners grow into an outsized share of your portfolio, quietly raising your risk. Rebalancing means periodically trimming back to your target split. It feels wrong every single time — you are selling what is working — and that is precisely why it works.

Check yourself

Rebalancing means…

  1. Buying more of what's rising
  2. Trimming winners back to your target split correct
  3. Selling everything in a downturn

Left alone, a portfolio drifts toward whatever recently ran. Rebalancing is how you keep the risk you chose.

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