rebalancing
In financial contexts, this term describes a disciplined strategy to manage risk. It is not merely about adding assets, but specifically about selling high-performing assets and buying underperforming ones to return to a predetermined percentage split. This creates a systematic "buy low, sell high" mechanism.
In mechanical engineering, the term refers to the physical removal or addition of mass to eliminate centrifugal forces. This is a technical process used to ensure the longevity of rotating machinery by preventing destructive vibrations.
Meanings
The process of adjusting the proportions of assets in an investment portfolio to maintain a specific target allocation.
The financial advisor recommended quarterly rebalancing to reduce risk exposure.
The act of restoring physical equilibrium or stability to an object, such as a tire or a mechanical component, to prevent vibration.
The technician performed a precision rebalancing of the engine's crankshaft.
Adjusting the weights, proportions, or distribution of something to achieve a desired state of equilibrium.
The company is rebalancing its workforce to focus more on digital product development.