The idea
You pick a target mix, but prices keep moving, so the mix drifts on its own. If stocks climb a lot, your stock slice quietly becomes bigger than you planned, and you end up carrying more risk than you chose. Rebalancing means moving money from the slice that got too big into the slice that got too small, so you land back on your target. Many investors check on a schedule, such as once a year, rather than watching every single day. 🔁
Words to know
- target mix
- The split of stocks, bonds and cash you decided you want.
- drift
- When prices move and your mix slowly changes by itself.
- rebalance
- Moving money around to get back to your target mix.
- trim
- Selling a little of a part that has grown into too big a share.
- top up
- Adding to a part of your mix that has become too small a share.
Try it — no account needed
Some moves bring your mix back to target. Some pull it further away.
Sort each move into the right box.
0 / 6 sorted
In the full lesson
- 1Sort into groups
- 2Work out the number
- 3Make the call
Vine has 107 lessons like this one, each written three ways so a 7-year-old and a 17-year-old both get a version that fits.
Practice with real prices
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