Rebalancing

Refers to the buying or selling of investments in order to return your investment portfolio to the ratios of bonds, shares and other investments that you originally wanted (also known as your asset allocation).

Because different investments perform differently to each other (one could perform better, but another worse), this means that over time certain investments can end up taking up more or less space in your portfolio than you had originally planned for. Rebalancing is essential to managing an investment portfolio.

Find out more about rebalancing your portfolio in our How to choose and manage your own investments guide.

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