5 Essential Tricks for Efficient Pension Portfolio Rebalancing
Market performance inevitably disrupts retirement portfolios, causing asset allocations to drift from their intended risk profiles. Annual rebalancing—a 15-minute discipline—can restore equilibrium without unnecessary trading costs or emotional decision-making.
The most effective strategy combines calendar discipline with tactical adjustments. Redirecting dividends and new contributions toward underweight assets often eliminates the need for sales. Threshold-based rebalancing—only adjusting when allocations deviate by 5 percentage points—prevents overtrading while maintaining risk parameters.
Tax-advantaged accounts allow for swap-based reallocation without triggering capital gains. This systematic approach transforms portfolio maintenance from reactive guesswork into proactive governance.
