Your Folio can be rebalanced automatically or manually, depending on your chosen strategy. We support three options: Buy & Hold, 1-Year, and Quarterly.
The options that allow a hands-off approach, 1-Year and Quarterly, can help ensure your investments stay on track, providing peace of mind. You can also change your rebalancing strategy at any time.
Why Should I Rebalance My Folio?
Rebalancing is the practice of shifting, or reallocating, a portfolio’s investments in an effort to maintain an appropriate blend of stocks that aligns with your long-term strategy. Studies have shown that, over the long-term, a portfolio that was never rebalanced had 16% more annualized volatility and no additional return benefits, than a rebalanced portfolio.*
* Fidelity, "How rebalancing can help reduce volatility in your portfolio", 3.
When Are Folios Rebalanced?
Rebalancing frequency depends on the strategy selected when creating your Folio. You can update this setting at any time.
The available options are:
– Buy & Hold: No automatic rebalancing. You can manually rebalance your Folio at any time.
– 1-Year: Automatically rebalances one year after your most recent purchase of the Folio. This helps reduce the likelihood of realizing short-term capital gains and may offer tax efficiency. Any new purchase restarts the 1-year countdown.
– Quarterly: Automatically rebalances on the last trading day of each financial quarter (March, June, September, and December). This approach follows institutional best practice and keeps your portfolio aligned with standard investment cycles.
For a list of upcoming quarterly rebalance dates and to view historical dates used in our Folio back-tests, read more.
Can I Modify a Folio After Creating It?
Yes, users can modify their Folio at any time. You can:
– Adjust your stock selection or weighting strategy and queue changes for your next scheduled automatic rebalance (if using 1-Year or Quarterly); or
– Manually implement changes to take effect during the current or next available trading session.
You can also change your rebalancing strategy at any time. Your new setting will apply going forward and determine when your next automatic rebalance takes place.
This content is for informational purposes only. OPTO Markets LLC does not recommend any specific securities or investment strategies. Investing involves risk & investments may lose value, including the loss of principal. Past performance does not guarantee future results. Investors should consider their investment objectives and risks carefully before investing.
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