Why Rebalance Your Portfolio?
Over time, different asset classes grow at different rates. If the stock market rallies, your Equity percentage might increase beyond your comfort zone, increasing your risk. Conversely, if markets crash, you might be holding too little equity.
The SIP Portfolio Rebalancing Tool helps you determine exactly how much you need to sell from one asset class and buy in another to return to your original financial plan (e.g., 60% Equity / 40% Debt).
Benefits of Rebalancing
- Risk Control: Ensures you don't take more risk than you intended.
- Buy Low, Sell High: Forces you to sell assets that have rallied and buy assets that are undervalued.
- Disciplined Investing: Removes emotion from investment decisions.