The trades that return a portfolio to its target weights, with a band so small drifts are left alone and an option to rebalance with new money instead of selling. Selling to rebalance realises gains, which is a cost the drift often does not justify.
Also called: rebalance portfolio, portfolio drift calculator.
₹1,50,000 of trading brings the portfolio back to its targets. 2 of 3 holdings have left the 5% band. The rest are close enough that trading them would cost more than the drift. Selling the overweight holdings realises gains on them. Check the tax before trading, and consider directing new contributions instead.
An estimate, not an offer or a guarantee. Projected returns assume the rate you entered holds for the whole term, which no market does.
| Holding | Current | Current % | Target % | Drift | Trade | Action |
|---|---|---|---|---|---|---|
| Equity | ₹6,00,000 | 60% | 50% | 10% | ₹1,00,000 | Sell |
| Debt | ₹2,50,000 | 25% | 30% | -5% | ₹0 | Inside band |
| Gold | ₹1,50,000 | 15% | 20% | -5% | ₹50,000 | Buy |
This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for India change on a published schedule; the effective date is shown on every rule-based tool.
Rebalancing is arithmetic on shares of a whole: each target weight applied to the total gives the value that holding should carry, and the difference is the trade. The band is what stops this becoming a treadmill, since a holding two points off target costs more in spreads and tax to correct than the drift is worth. Directing new money at the underweight holdings does the same job without a sale, which matters where a sale is a taxable event, and the page shows when new money alone is not enough to close the gap rather than pretending it is.
each holding is traded to the difference between its target share of the whole portfolio and what it currently holdsEach of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.
Value to trade₹1,50,000
equity is 60% against a 50% target on a 1,000,000 portfolio, so 100,000 comes out
Open this exampleValue to trade₹0
boundary: every drift is inside the 5 point band
Open this exampleFormula version 1.0.0 · definition 1.0.0 · India · Report a problem with this calculator