Background: I have several accounts for various family members all in the HB 4x25 (via ETFs and not PRPFX), some in taxable and some not. some i add to monthly, yearly, or not at all. so i have to rebalance them individualy by person.
My question is at what point is it not worth it to rebalaance? should i spend $8.95 in order to trade less than a $1000 in some cases? some of these trades would amount to 1-2% of the traded amount. appreciate any feedback.
rebalancing help
Moderator: Global Moderator
-
arizonafan1
- Junior Member
- Posts: 9
- Joined: Wed Apr 27, 2011 9:45 pm
Re: rebalancing help
Personally I like to deal in round lots (100 shares) or if the stock price is too high then I'll use 50 shares. I realize this is not necessary with todays markets, but it keeps things nice and simple in my account and my mind. Normally this will add up to $3000-$4000 per trade. This works out to a one time cost of 0.3%, which isn't too bad.arizonafan1 wrote: Background: I have several accounts for various family members all in the HB 4x25 (via ETFs and not PRPFX), some in taxable and some not. some i add to monthly, yearly, or not at all. so i have to rebalance them individualy by person.
My question is at what point is it not worth it to rebalaance? should i spend $8.95 in order to trade less than a $1000 in some cases? some of these trades would amount to 1-2% of the traded amount. appreciate any feedback.
In addition, you could use mutual funds to add small monthly contributions into the four components, then once you have enough saved up for a round lot, simply sell the mutual fund and buy the etf. Just be careful to ensure there are no penalties for exiting the mutual fund within a certain time period.