Stupid question, but I haven't rebalanced before. I totally understand the why's and how's of rebalancing as a concept. I know exactly how much to buy and sell in each of my accounts to bring my overall portfolio back to my desired allocation. It's just the mechanics of actually doing it that are unfamiliar.
Do I sell a portion of my "overweight" investments and wait until the sale proceeds have gone into a settlement fund, then (presumably after a day or so) use the settlement fund to buy shares in the "underweight" investments? In my case that would be selling a portion of 10 funds across three retirement accounts, then buying more of 13 funds across those three accounts -- in other words, a lot of individual transactions. Is there a more efficient way? Will all those transactions generate fees?
By the way, I'm retired and no longer contributing to the accounts so I can't rebalance with future contributions. I will, however, turn off automatic reinvesting and then use future dividends to help maintain my allocation.
Do I sell a portion of my "overweight" investments and wait until the sale proceeds have gone into a settlement fund, then (presumably after a day or so) use the settlement fund to buy shares in the "underweight" investments? In my case that would be selling a portion of 10 funds across three retirement accounts, then buying more of 13 funds across those three accounts -- in other words, a lot of individual transactions. Is there a more efficient way? Will all those transactions generate fees?
By the way, I'm retired and no longer contributing to the accounts so I can't rebalance with future contributions. I will, however, turn off automatic reinvesting and then use future dividends to help maintain my allocation.
Statistics: Posted by Fortunate1 — Fri Aug 02, 2024 5:47 pm — Replies 5 — Views 402