Revisit Your Investment Statement and Consider Rebalancing

Revisit Your Investment Statement and Consider Rebalancing

 Reviewing investment policy statement is a must, or check the IPS, a document that has everything in detail. Doing an IPS means you include if you have goals, your needs of cash flow as your income has stopped and you are a senior now. The returns you want at your horizon time, the risk tolerance that includes the money you can withstand losing without any effect on your plans, different issues the stage-of-life and tax concerns. Once the IPS is set right, seniors you may check your asset allocation. This will establish the money required to allocate to bonds, stocks, and cash, and within these assets the allocation will be possible for how much amount. For instance: domestic and international stocks, small-cap stocks, large and mid stocks, value and growth stocks, and so on. This also helps in determining that you can allocate to high-yield, corporate, government, emerging and international market securities, besides the yield curve to invest your investments of fixed-income.

Decide the time to Rebalance

The IPS gives time to rebalance your portfolio while it is moving from its target asset allocation. There may be a need for expert’s advice when you consider rebalancing. Especially with seniors considering rebalancing of investment, it is best to buy your losers and sell your winners once a quarter or year at least. This act of rebalancing method in portfolio allocation helps in drifting slightly and in triggering a rebalancing trade, in case there is a target threshold. If you find your investments are growing in line and do not change the relative weightings, no rebalancing occurs in trade. But, if the tolerance bands of rebalancing are breached, it means the investment is sold or bought back within the bands. Thus use tolerance bands to identify if you can rebalance. It is good to check and seniors liberally set 5 percentage points and around 10 percentage points for common assets and esoteric assets that are breached. If it is breached, consider an emotionless cold-blooded instruction of selling that investment or buying more of that investment.


Another way of looking at your portfolio is in considering diversification with United Healthcare Medicare Advantage Plans 2020 via The principle of investment is not putting in one basket all your eggs. You may invest in bond around 40% and in traditional stocks around 60%. Anything goes up or down, one of them is sure to balance the other. Thereby, seniors can sleep peacefully at night.