Rebalancing means that the distribution of your investment fund portfolio is kept constant over time. If an investment fund portfolio is not rebalanced, some funds will do relatively better than others which will lead to a deviation between the various types of investment fund from the desired distribution. A portfolio that is not rebalanced will likely have increased risk over time since more risky assets tend to provide higher returns and thus constitute a larger portion of the portfolio.

Specifically, a rebalancing means that Advinans sells assets that have had a strong performance buys assets that have performed relatively worse. Advinans’ IT system takes care of the rebalancing automatically and there are no tax effects or transaction costs for you.