(Opalesque) Can automatic rebalancing end up doing investor portfolios more harm than good? A new study from Man Group suggests that automatic rebalancing can mean that investors sell out of profitable investments at exactly the wrong time.”Rebalancing is an active strategy that can actually end up making the impact of drawdowns on a portfolio worse,” explains Otto Van Hemert, Head of Macro Research at Man AHL and one of the authors of the paper in an interview.
Investors should rethink automatic portfolio rebalancing,
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