BacktestFolio · Glossary
Rebalancing
In plain language
If an asset grows sharply and exceeds its target weight, the excess is sold to buy underweight assets. This maintains the original risk profile; under some market conditions it can also help long-term results, but it is not an automatic return premium.
Technical definition
Rule by which the engine realigns weights at the user-selected frequency, affecting portfolio turnover and simulated outcome.