A shift in private wealth management
As global markets move towards growth after the Covid-19 pandemic, it is clear that the pandemic has changed economies, individuals’ wealth, and how investors build and maintain their portfolios. Chris Hyzy, the Chief Investment Officer for Merrill and Bank of America Private Bank believes that “Investors will need a higher level of diversification, more frequent portfolio rebalancing and exposure to newly developing themes.”
Thomas Rappold, CEO of Divizend and co-founder of the Swiss unicorn, Numbrs, shares the same sentiment and pointed out that they were in a similar situation 20 years ago. When it comes to financial markets, certain assets were a lot more valuable than others, back then it was tech, media, and telecoms, while today it’s crypto. People that didn’t rebalance when the Nasdaq 5000 lost 80 percent of its value, lost a lot of their money.
“Rebalancing is a missed opportunity. Even though it’s mathematically really simple, in practice this is still a hassle, especially for retail investors that don’t have their portfolios aggregated.”
Thomas Rappold, CEO of Divizend
Keeping this in mind, it is important to explore portfolio rebalancing, the benefits, best practices, and reasons to consider it.