How Portfolio Rebalancing Usually Reduces Long-Term Returns (But Is Good Risk Management Anyway)

The conventional view of portfolio rebalancing is that it is a strategy to enhance long-term returns by periodically selling the investments that are up (and overweighted) to buy those that are down (and underweighted), in the process of realigning the portfolio to its original target allocation. Yet the reality is that because most investments go … Continue reading How Portfolio Rebalancing Usually Reduces Long-Term Returns (But Is Good Risk Management Anyway)