Rebalancing is the process of realigning portfolio weights back to target allocations. As some assets outperform others, the portfolio drifts from its intended allocation, potentially changing the risk profile.
Rebalance Amount = (Current Weight - Target Weight) × Portfolio Value
If your target is 60% stocks / 40% bonds, but strong stock returns push it to 70/30, you would sell stocks and buy bonds to return to 60/40.
AllInvestView's rebalancing tool calculates exact trades needed to hit your targets. Read our portfolio rebalancing guide for strategies.