Rebalancing is the process of changing the weights of assets in your portfolio to achieve an optimal balance of risk and returns.
Here’s a hypothetical example. A Vinovestor wants 33% Bordeaux, 33% Champagne, and 33% Napa Valley in their portfolio. However, Napa Valley wine prices outpaced Bordeaux and Champagne. As a result, their portfolio shifted away from its target allocation levels. Now, the portfolio contains 25% Bordeaux, 25% Champagne, and 50% Napa Valley.
Rebalancing helps restore the desired balance. Our team will reduce the exposure by replacing some Napa Valley wines with wines from other top-performing regions. This process will balance the portfolio to 33% Bordeaux, 33% Champagne, and 33% Napa Valley again.
Vinovest clients do not have to do anything to enroll in rebalancing. Additionally, Vinovest may rebalance wine or whiskey in managed portfolios at its discretion in order to help clients best navigate the complexities of the marketplace. If you prefer to build your own portfolio, you can check out the Vinovest Marketplace.