Portfolio Allocation Calculator

Compare current allocation against target and see the trades needed to realign.

About Portfolio Allocation Calculator

Rebalancing bands avoid constant trading on small moves while still controlling risk. A five point band on a 70% equity target means acting only outside the 65 to 75 range. Threshold rebalancing captures most of the risk control of calendar rebalancing at a fraction of the trading cost.

Formula

Portfolio Allocation

Trade = target weight × portfolio value − current holding value

threshold: Drift tolerated before rebalancing, to avoid trading on noise

Worked example

With the default values below, Portfolio Allocation Calculator returns Equity Trade Needed of -$24,000.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Portfolio valueminimum 0.01: 300,000
Current equity allocationaccepts 0–100 %: 78 %
Target equity allocationaccepts 0–100 %: 70 %
Rebalancing thresholdaccepts 0–100 %: 5 %

Results

Equity Trade Needed: -$24,000.00
Drift From Target: 8.00%
Current Equity Value: $234,000.00
Target Equity Value: $210,000.00
Action: Sell 24000 of equities

Step by step

1Values used
2Portfolio Allocation
3Equity Trade Needed= -24,000.00
4Drift From Target= 8.00
5Current Equity Value= 234,000.00
6Target Equity Value= 210,000.00
7Action= Sell 24000 of equities

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

How is Portfolio Allocation calculated?

Trade = target weight × portfolio value − current holding value Rebalancing bands avoid constant trading on small moves while still controlling risk. A five point band on a 70% equity target means acting only outside the 65 to 75 range.

Why does Portfolio Allocation matter?

Threshold rebalancing captures most of the risk control of calendar rebalancing at a fraction of the trading cost.

What values do I need to enter?

This calculator takes 4 inputs: Portfolio value, Current equity allocation, Target equity allocation, Rebalancing threshold. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.