rebalancing

Definition

Making adjustments to counteract the fact that different assets have performed differently and now comprise different percentages of the portfolio than they were intended to. For example, a portfolio with a high growth objective holding 20 percent of its assets in money market securities should consider rebalancing to hold fewer assets in money market securities and more assets in stocks or other higher risk instruments.

Use rebalancing in a sentence

You should try to do your best at rebalancing so that you know you will be able to do it the right way.

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The rebalancing of the company was going well and I thought that it would take a little more work to get it going.

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Our company recommends rebalancing our clients' accounts at least yearly, or more often when the market isn't performing as predicted.

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