Rebalancing Of Portfolio

Why Rebalancing of your portfolio is important?

Rebalancing of investments is done to ensure that your portfolio is a good mix of the level of risk you are willing to take

Your portfolio shall have the right mix of assets that go in a great combination with your financial situation and your age.

Things to keep in mind while rebalancing your portfolio

1.Maintaining the asset allocation mix

It allows you to go by your financial plan regardless of how the market behaves. You should keep in mind that change of over 10% in your asset mix may have significant impact on your portfolio

2.Practising discipline

Rebalancing brings with it benefits of discipline. Maintain the investment discipline even if the markets are running up in bull phase or down in bear phase

3.Keep long term goal focus

Markets are cyclical in nature, so what goes up will come down eventually. Your portfolio must be monitored & rebalanced periodically to achieve your long term financial goal

Benefits of rebalancing

  • Helps align your investment with your goals.
  • Impose discipline on investing
  • Risk minimizing strategy