Introduction:
Portfolio rebalancing is a crucial aspect of maintaining a well-structured investment portfolio. It involves periodically realigning the weightings of assets in a portfolio to ensure they continue to meet the investor's risk tolerance, goals, and time horizon.
Main Content:
Rebalancing is essential to manage risk and optimize returns. For example, suppose an investor initially allocated 60% of their portfolio to stocks and 40% to bonds. Over time, due to market fluctuations, the stock portion may increase to 70%. Rebalancing would involve selling a portion of the stocks and buying more bonds to return to . . .
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