How rebalancing works
Rebalancing automatically adjusts your portfolio to match your target asset allocation, ensuring your investments stay on track with your risk tolerance and goals. Sticking to your investment strategy allows you to reset your assets to sell investments that are over performing and buy investment areas that are likely under valued. Enrich allows you to implement condition-based rebalancing - when your investments hit a certain threshold to require a rebalance, and does not perform scheduled rebalancing. To learn more about this approach, see this whitepaper.
Step 1: Set your target allocation and sensitivity
When creating a goal, you define:
Target allocation: The percentage of your portfolio allocated to specific asset classes (e.g., 60% stocks, 40% bonds).
Relative rebalance sensitivity: A threshold (e.g., ±20% of the target) that triggers rebalancing.
Example:
Target allocation for stocks: 50%
Relative sensitivity: 20%
Rebalancing triggers if stocks exceed 60% (50% + 20% of 50%) or fall below 40% (50% – 20% of 50%)
Step 2: Get notified when rebalancing is needed
If your portfolio drifts outside the sensitivity threshold, you’ll receive:
Email alerts
In-app notifications (tap to preview changes).
Step 3: Review rebalance recommendations
The Rebalance Preview page shows:
Buy/sell amounts for each holding to restore your target allocation.
Weighted adjustments for investments with mixed exposures (e.g., a mutual fund’s geographic or sector breakdown).
Tax-optimized account placement (e.g., muni bonds in taxable accounts, REITs in tax-advantaged accounts).
Step 4: Execute the rebalance
Add funds to invest more without selling existing holdings.
Withdraw funds to reduce your portfolio’s size.
Confirm adjustments by pressing "lock and execute", and this will kick off a set of tasks that you need to perform within each institution.
Key notes
Unallocated holdings: Investments not tied to a rule (e.g., crypto) won’t trigger rebalancing.
Taxes and costs: Rebalancing may create capital gains or transaction fees—these are not accounted for when we provide a rebalance calculation.
Adjust sensitivity anytime: your sensitivity is goal specific, you can adjust it anytime.
Rebalancing ensures your portfolio stays aligned with your goals, even as markets shift. Set your preferences, and let Enrich handle the rest—no spreadsheets or guesswork needed.