{"url":"https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/","section":"academy","title":"Rebalancing | ETFIQ","description":"See how a 60/40 portfolio drifted to 78% stocks in nine years without rebalancing, and what that did to risk, using real ETF benchmark data.","as_of":"Oct 30, 2026","structured_data":[{"@type":"LearningResource","@id":"https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/#lesson","name":"Rebalancing: why your mix drifts and when to reset it","description":"A 60/40 mix of ETFIQ's stock and bond benchmarks left alone from Dec 30, 2016 drifted to 78.0% stocks by Dec 31, 2025, hypothetically.","url":"https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/","learningResourceType":"Lesson","teaches":"Why a mix drifts away from its weights, how rebalancing keeps the risk chosen, and what it costs","educationalLevel":"Beginner","timeRequired":"PT7M","inLanguage":"en","isAccessibleForFree":true,"isPartOf":{"@type":"Course","@id":"https://etfiq.com/academy/build-a-simple-portfolio/#course","name":"Build a Simple Portfolio","url":"https://etfiq.com/academy/build-a-simple-portfolio/"},"position":6,"dateModified":"2026-10-30","author":{"@type":"Organization","name":"ETFIQ Research","url":"https://etfiq.com"},"publisher":{"@type":"Organization","name":"ETFIQ Research","url":"https://etfiq.com"}},{"@type":"FAQPage","@id":"https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/#check","mainEntity":[{"@type":"Question","name":"You start at 50% stocks and 50% bonds. Over a year stocks rise 20% and bonds 0%. What is your stock share now, before rebalancing?","acceptedAnswer":{"@type":"Answer","text":"About 55%. $5,000 \u00d7 1.20 = $6,000 in stocks; $6,000 \u00f7 $11,000 = 54.5%."}},{"@type":"Question","name":"What is rebalancing's main job?","acceptedAnswer":{"@type":"Answer","text":"To keep your risk at the level you chose. It holds your weights, so your swings match your plan."}},{"@type":"Question","name":"A portfolio built at 60% stocks has drifted to 78%. Going by the benchmarks, how does its likely worst fall compare with the original plan?","acceptedAnswer":{"@type":"Answer","text":"Deeper, closer to an 80% stock mix's. Strategic 80 fell 28.15% at its worst, against 22.31% for Strategic 60."}}]},{"@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"ETFIQ","item":"https://etfiq.com/"},{"@type":"ListItem","position":2,"name":"Academy","item":"https://etfiq.com/academy/"},{"@type":"ListItem","position":3,"name":"Build a Simple Portfolio","item":"https://etfiq.com/academy/build-a-simple-portfolio/"},{"@type":"ListItem","position":4,"name":"Rebalancing","item":"https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/"}]},{"@type":"WebPage","name":"Rebalancing","description":"See how a 60/40 portfolio drifted to 78% stocks in nine years without rebalancing, and what that did to risk, using real ETF benchmark data.","url":"https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/","dateModified":"2026-10-30","isPartOf":{"@type":"WebSite","name":"ETFIQ","url":"https://etfiq.com"},"speakable":{"@type":"SpeakableSpecification","cssSelector":[".lede"]},"publisher":{"@id":"https://etfiq.com/#org"}}],"characters":5742,"truncated":false,"content":"ETFIQ / Academy / Build a Simple Portfolio / Rebalancing \n \n Rebalancing: why your mix drifts and when to reset it\n Data as of Oct 30, 2026. Rebuilt every trading night.\n A 60/40 mix of ETFIQ's stock and bond benchmarks left alone from Dec 30, 2016 drifted to 78.0% stocks by Dec 31, 2025 , hypothetically.\n Build a Simple Portfolio \u00b7 Lesson 6 of 6 1 2 3 4 5 6 \n Set an amount. See how much of it sits in stocks and in bonds after nine years left alone. Amount (hypothetical) $10,000 Stocks (left alone) $7,801 Bonds $2,199 Of $10,000: Stocks (left alone) $7,801, Bonds $2,199. Hypothetical: $10,000 split 60/40 on Dec 30, 2016 and never traded, benchmark returns on past prices. Traded back to 60/40 each month it stays 60/40. \n The question\n I picked a mix, say 60% stocks and 40% bonds. If I never touch it, does it stay that way?\n The idea\n No. Each part grows at its own speed, so the weights move. When stocks rise faster than bonds, stocks become a bigger share of your money. That is drift .\n Rebalancing means trading back to your chosen weights: moving money out of what grew most and into what grew least. Its main job is to keep your risk where you chose it , not to raise your return.\n Worked example\n ETFIQ's benchmarks ( lesson 1 ) include Strategic 60, 60% stocks and 40% bonds traded back to those weights every month, and Strategic 80, at 80% stocks.\n Start with $10,000 on Dec 30, 2016 : $6,000 in ETFIQ's Global Stocks benchmark (all in VT, a world stock fund) and $4,000 in its US Bonds benchmark (BND and AGG). Never trade. Each year, each part grows by its own calendar-year return. Benchmark returns are hypothetical: today's rules applied to past prices.\n Year one, step by step. In 2017 stocks returned 24.49% and bonds 3.56% .\n Stocks: $6,000 \u00d7 1.2449 = $7,469 \n Bonds: $4,000 \u00d7 1.0356 = $4,142 \n Total: $11,612 . Stock share: $7,469 \u00f7 $11,612 = 64.3% \n One good year for stocks moved the mix 4 points. Carry on the same way:\n End of Never traded: stock share Never traded: value Strategic 60 (rebalanced): value \n 2017 64.3% $11,612 $11,571 \n 2019 65.5% $13,048 $13,035 \n 2021 71.3% $16,543 $16,299 \n 2023 73.0% $16,161 $15,821 \n 2025 78.0% $21,562 $20,268 \n By the end of 2025, the \"60/40\" portfolio was 78% stocks . Nobody chose that; it happened.\n Did leaving it alone pay? Here, yes : $21,562 \u2212 $20,268 = $1,294 more , because stocks beat bonds in most of these years and the drifted mix held more of them.\n What it cost in risk. A 78% stock mix behaves much like Strategic 80. Over the ten years to Oct 30, 2026 , Strategic 80's worst fall was \u221228.15% , against \u221222.31% for Strategic 60. On $20,000, about where both portfolios ended: $20,000 \u00d7 28.15% = $5,630 lost, against $20,000 \u00d7 22.31% = $4,462 . The drifted portfolio carried the risk of a mix its owner never picked.\n The common mistake\n \"Rebalancing is a way to earn more.\" Sometimes it does, often it doesn't. In this decade, leaving the mix alone ended $1,294 ahead , because stocks mostly won. Rebalancing's reliable effect is on risk: it keeps the mix you chose, so your worst year looks like the one you planned for.\n A second mistake: rebalancing so often that trading costs and taxes eat into returns. Selling in a taxable account can create a tax bill, so your calendar or band has a cost too.\n Check your understanding\n Pick an answer to see why. Two of three right passes the lesson.\n 1. You start at 50% stocks and 50% bonds. Over a year stocks rise 20% and bonds 0%. What is your stock share now, before rebalancing? A 50% B About 55% C 60% D 70% Answer: B. About 55%. $5,000 \u00d7 1.20 = $6,000 in stocks; $6,000 \u00f7 $11,000 = 54.5%. Not C: stocks grew 20%, but the share rises less because the total grew too. 2. What is rebalancing's main job? A To guarantee a higher return B To keep your risk at the level you chose C To avoid all losses D To lower fees Answer: B. To keep your risk at the level you chose. It holds your weights, so your swings match your plan. Not A: in this lesson's decade, leaving the mix alone ended with more money. 3. A portfolio built at 60% stocks has drifted to 78% . Going by the benchmarks, how does its likely worst fall compare with the original plan? A About the same B Smaller C Deeper, closer to an 80% stock mix's D It can't be estimated Answer: C. Deeper, closer to an 80% stock mix's. Strategic 80 fell 28.15% at its worst, against 22.31% for Strategic 60. Not A: more stocks means deeper falls, as lesson 1 showed. \n Takeaways\n Check your stock share at least once a year; it drifts toward whatever grew fastest. \n Rebalancing keeps the risk you chose; it is not a return booster. \n Pick a rule, a calendar or a band, and write it down before markets move. \n Do it on ETFIQ\n Load your own mix and see its stock share today \n Where to next\n Previous lesson: How to compare two funds on the facts Build a Simple Portfolio: all lessons The explainer behind this lesson ETFIQ Academy How ETFIQ computes these numbers \n Cite this page. ETFIQ, Rebalancing: why your mix drifts and when to reset it, data as of Oct 30, 2026. https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/ Free to use with attribution for data ETFIQ computes; issuer data stays under its owner's terms. The underlying files are at Open data .\n Other forms Plain ETFIQ, Rebalancing: why your mix drifts and when to reset it, data as of Oct 30, 2026. https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/ APA ETFIQ. (Oct 30, 2026). Rebalancing: why your mix drifts and when to reset it. Retrieved from https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/ Markdown [Rebalancing: why your mix drifts and when to reset it (ETFIQ, Oct 30, 2026)](https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/)","source":"ETFIQ, independent ETF data. Recomputed nightly from public filings and prices.","publisher":{"@id":"https://etfiq.com/#org","name":"ETFIQ","url":"https://etfiq.com"},"license":"https://etfiq.com/license/","license_text":"Data ETFIQ computes is free to use with attribution: ETFIQ (etfiq.com). Issuer data stays under its owner's terms.","citation":"ETFIQ, Rebalancing: why your mix drifts and when to reset it, data as of Oct 30, 2026. https://etfiq.com/academy/build-a-simple-portfolio/rebalancing/"}