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To rebalance or not to rebalance
This answer will assume you know more math than most. An ideal case: For the point of argument, first consider the following admittedly incorrect assumptions: 1)  The prices of all assets in your investment universe are continuously differentiable functions of time. 2)  Investor R (for rebalance) continuously buys and sells in order to maintain a constant proportion of each of several investments in his portfolio. 3)  Investor P (for passive) starts with the same portfolio as R, but neither buys nor sells Then under the assumptions of no taxes or trading costs, it is a mathematical theorem that investor P's portfolio return fraction will be the weighted arithmetic mean of the return fractions of all the individual investments, whereas investor R will obtain the weighted geometric mean of the return fractions of the individual investments. It's also a theorem that the weighted arithmetic mean is ALWAYS greater than or equal to the weighted geometric mean, so regardless of what happens in the market (given the above assumptions) the passive investor P does at least as well as the rebalancing investor R.  P will do even better if taxes and trading costs are factored in. The real world:  Of course prices aren't continuously differentiable or even continuous, nor can you continuously trade.  (Indeed, under such assumptions the optimal investing strategy would be to sample the prices sufficiently rapidly to capture the derivatives and then to move all your assets to the stock increasing at the highest relative rate.  This crazy momentum trading would explosively destabilize the market and cause the assumptions to break.) The point of this is not to argue for or against rebalancing, but to point out that any argument for rebalancing which continues to hold under the above ideal assumptions is bogus.  (Many such arguments do.)  If a stockbroker standing to profit from commission pushes rebalancing on you with an argument that still holds under the above assumptions then he is profiting off of BS.