Periodic rebalancing is generally a good way to keep your investing strategy on track and to prevent your portfolio from becoming too risky during market surges (like the one we’ve been experiencing in recent years) or too conservative after big market setbacks.
That said, I don’t think you have to be a fanatic about it. There may be times when you can skip rebalancing altogether, and sometimes you may be able to bring your portfolio’s balance of risk and return back in line without re-jiggering the investments you already own.
Written By: Walter Updegrave
Published By: www.money.cnn.com