Portfolio Rebalancing Explained: How and Why to Do It

Portfolio rebalancing is the process of bringing your investments back to the mix of stocks and bonds you originally chose. In this episode, Ryan walks through a simple 50/50 example to show how a strong run in stocks can quietly shift your portfolio toward more risk than you intended, and how selling the overweight position and buying more of the underweight one corrects the drift.He also covers how often to rebalance. Too frequently can create unnecessary trading costs and tax events; too rarely leaves your allocation out of balance for years. Ryan compares time-based rebalancing (quarterly or annually) with a guardrail approach, where technology triggers a rebalance only when the portfolio drifts past a set threshold. If you have never looked at how your actual holdings compare to your target allocation, this episode is a good place to start.Find "Your Fiscal Physical" the book on AmazonIf you have suggestions or feedback, please email us at: [email protected], as always, Stay the Course!