Why rebalance with new money instead of selling?

Because it avoids realising a gain and halves the number of transactions. Directing a contribution at whichever holding is furthest below target moves the portfolio towards its weights using money that was going in anyway, with one purchase instead of a sale and a purchase. For a portfolio still in its accumulation phase this is often enough on its own, and the calculator shows how much of the gap it closes.

What drift threshold should I use?

A band rather than a date is the useful idea; the specific width is a convention, not a rule. The default here is a starting point, and a wider band means fewer transactions and more drift while a narrower one means the reverse. What matters is choosing a rule in advance and following it, because the alternative is rebalancing when markets make you anxious, which tends to be the worst moment to be selling.

Does it account for tax on the sales it suggests?

No, and that is a deliberate omission rather than an oversight. The tax depends on where you live, and in two of the four countries covered here it is substantial enough to change whether a rebalance is worth doing at all. The country simulators price that layer; this calculator gives you the trades, and the honest assumption is that selling costs more than it appears to.

Rebalancing calculator: what to buy, and what not to sell

Rebalancing is usually described as selling what has done well and buying what has not. That description quietly assumes selling is free, which it is not: it triggers a transaction cost everywhere and a tax event in some countries. For anyone still contributing, there is a cheaper route that most rebalancing advice skips entirely — steering the next contribution rather than unwinding the last one.

The calculator

How it works

Enter each holding's current value and the share of the portfolio you want it to be. The calculator works out what that share is worth against the current total, and the difference between that and what you hold is the trade. Drift is reported in percentage points between the current and target share, and anything inside the band you set is greyed out rather than flagged, because rebalancing costs money and small drift is not worth paying for. Enter a contribution and the same table shows how much of the gap new money closes on its own.

What it assumes

The output is a pre-tax, pre-cost instruction and should be read as one. Selling is not free: in Italy a sale realises capital gains tax at the flat rate, in Belgium both sides of the trade attract transaction tax, and everywhere it costs a commission that the break-even calculator can price for your broker. Those are deliberately not netted out here, because they depend on your broker, your residence and how long you have held — which is exactly why the new-contribution mode exists.

Common questions

Why rebalance with new money instead of selling?: Because it avoids realising a gain and halves the number of transactions. Directing a contribution at whichever holding is furthest below target moves the portfolio towards its weights using money that was going in anyway, with one purchase instead of a sale and a purchase. For a portfolio still in its accumulation phase this is often enough on its own, and the calculator shows how much of the gap it closes.
What drift threshold should I use?: A band rather than a date is the useful idea; the specific width is a convention, not a rule. The default here is a starting point, and a wider band means fewer transactions and more drift while a narrower one means the reverse. What matters is choosing a rule in advance and following it, because the alternative is rebalancing when markets make you anxious, which tends to be the worst moment to be selling.
Does it account for tax on the sales it suggests?: No, and that is a deliberate omission rather than an oversight. The tax depends on where you live, and in two of the four countries covered here it is substantial enough to change whether a rebalance is worth doing at all. The country simulators price that layer; this calculator gives you the trades, and the honest assumption is that selling costs more than it appears to.

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Rebalancing calculator: what to buy, and what not to sell