Rebalancing bands

90/10 Portfolio Rebalancing Bands

The 90/10 Portfolio rebalancing bands under the 5/25 rule are the ranges each sleeve must stay inside before a threshold policy triggers a trade. For this allocation the bands run from 2.5 points on Total bond market to 5 points on Total US stock market, because the rule applies whichever is tighter of a 5 percentage point absolute threshold and 25 percent of each holding's own target weight.

Computed with the same engine as the free calculator. Educational analysis, not investment advice.

The bands for this allocation

At a 10% target the bond sleeve falls below the 5/25 crossover, so the relative threshold governs it rather than the 5 point band.

SleeveTargetBandBinding ruleRebalance outside
Total US stock market90%5 pointsabsolute85% to 95%
Total bond market10%2.5 pointsrelative7.5% to 12.5%

The tightest band belongs to Total bond market at 2.5 points, set by the relative threshold. 1 of 2 sleeves sit below the 20 percent crossover, so the 25 percent relative threshold governs them instead of the flat 5 point band.

What happens after a strong equity year

Holding the allocation untouched through a stylized year with equities up 30%, bonds down 10%, and real assets flat produces these weights. Nothing was bought or sold; the drift is purely market movement.

SleeveTargetAfter the moveStatus
Total US stock market90%92.86%in band
Total bond market10%7.14%underweight by 2.86%

1 of 2 sleeves breach, so a 5/25 policy would trade. Returning every sleeve to target moves about 2.86% of the portfolio.

A breach is not a recommendation: it means an allocation left the range you chose. Transaction costs, spreads, capital gains, wash-sale rules, and new contributions all affect whether acting is worthwhile. These figures are illustrative and use reference weights, not your holdings.

Run your own weights

These are reference targets. Enter what you actually hold to see your own bands, which threshold governs each sleeve, and how much would have to trade.

Open the rebalancing band calculator

90/10 Portfolio band questions

What are the 5/25 rebalancing bands for a 90/10 Portfolio?

Each sleeve gets the tighter of a 5 percentage point band and a band worth 25 percent of its own target. Total US stock market at a 90% target trades outside 85% to 95%, Total bond market at a 10% target trades outside 7.5% to 12.5%.

Which sleeve of a 90/10 Portfolio triggers first?

Total bond market has the tightest band at 2.5 points, governed by the relative threshold. 1 of 2 sleeves sit below the 20 percent crossover, so the relative threshold governs them rather than the flat 5 point band.

Would a 90/10 Portfolio need rebalancing after a stylized year with equities up 30%, bonds down 10%, and real assets flat?

Yes. After a stylized year with equities up 30%, bonds down 10%, and real assets flat, Total bond market would be underweight by 2.86%. Returning every sleeve to target moves about 2.86% of the portfolio.

Bands for other allocations

Drift is one dimension. Check portfolio concentration for what sits inside the sleeves, ETF overlap for funds holding the same companies, and the portfolio risk monitor for tracking all three across connected accounts.