Portfolio rebalancing calculator guide
This calculator converts target allocation percentages into practical buy and sell amounts. It is designed for investors who already know their target mix and want a quick rebalancing checklist.
How to use it
- Enter current stock, bond, and cash values.
- Enter your target percentage for each bucket.
- Use the buy/sell table as a planning estimate before placing trades.
Calculation method
Target dollars = total portfolio × target percentage
The difference between target dollars and current dollars becomes the buy or sell amount.
Common mistake
Rebalancing too often can create unnecessary trading and taxes. This educational calculator does not account for transaction costs or taxable events.
FAQ
Can I rebalance with new money only?
Often yes. If one asset is underweight, adding new contributions to that bucket may reduce the need to sell existing holdings.
What if my target percentages do not add to 100%?
The calculator normalizes the target weights, but it is still better to enter targets that add to 100%.
Is rebalancing always good?
Rebalancing controls risk. It does not guarantee higher returns.