Have you reviewed your portfolio lately to see if it's in sync with your goals? See how rebalancing your portfolio, including reallocating stocks, bonds and cash, could be a critical step to helping you stay on track. Read our insightful paper
Consider regular rebalancing of your investments to potentially help maximize returns and to potentially avoid being exposed to too much or not enough risk.
- Do you have the appropriate mix of assets?
- The dangers of "setting and forgetting"
- How to choose a rebalancing method
Benefits of Portfolio Rebalancing
This comparison shows the performance of two portfolios during the period of 1987 to 2013. Each portfolio starts out with a traditional allocation of 60% stocks and 40% bonds. One is rebalanced annually, and the other is not. The rebalanced portfolio experienced lower volatility and higher risk-adjusted returns.1
Source: Bloomberg, Merrill Lynch Investment Management & Guidance (IMG). Results shown are based on indexes and are illustrative. They are gross of fees, do not take into account tax implications or transactions costs, and assume reinvestment of income. Stocks and bonds are represented by the S&P 500 Total Return Index and the Barclays U.S. Aggregate Total Return Bond Index respectively. The statistics shown (Volatility and Max Loss) are calculated based on annual returns; "Max Loss" represents the largest yearly loss over the given period. Asset allocation does not ensure a profit or protect against a loss in declining markets. Past performance does not guarantee future results.
How Merrill Edge Can Help
- Our Asset Allocator™ tool helps you determine whether your current portfolio's in line with your investment style, risk tolerance, investment time horizon and liquidity needs.
- Choose from a wide array of investment choices with thousands of well-known mutual funds and ETFs, or have Merrill Lynch professionals actively manage your portfolio with Merrill Edge Select™ Portfolios.
- Review your portfolio allocation and define an action plan for your needs with one-on-one advice and guidance from a Merrill Edge Financial Solutions Advisor™ through Merrill Edge Roadmap™.
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