Glossary
Portfolio Rebalancing
The process of realigning portfolio weightings to target allocations by buying or selling holdings.
Portfolio rebalancing is the practice of periodically buying or selling holdings to bring a portfolio back to its target asset allocation. Over time, market movements cause actual weightings to drift from targets — for example, strong equity performance may leave a portfolio overweight in stocks relative to its intended allocation. Rebalancing restores the intended risk profile. For income-focused advisors, rebalancing decisions intersect with dividend analytics: replacing a high-yielding but low-safety holding with a lower-yielding but more reliable dividend payer may actually improve portfolio income stability even if it temporarily reduces headline yield.
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