The Myths and Dangers of Portfolio Rebalancing
The goal of creating financial wealth is to meet financial obligations, known and yet to come. One industry process commonly considered for preserving financial wealth is rebalancing. The idea of rebalancing a portfolio over time is widely considered as a strategy that can help mitigate concentration risk and deviations from target allocations. Changing the allocation between asset classes or investments by selling some/all of one and buying another, investors are advised, may reduce the traditional concept of “risk.”
