You can use the rebalance dashboard in the LUSID web app to select some holdings and achieve a wide variety of rebalancing configurations. What is rebalancing in LUSID?
You can provide a rebalancing configuration by navigating via the left hand menu to Dashboard > Rebalance and selecting one or more rows, followed by the Options icon > Control panel:
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You can choose from various Weighting methods when configuring your rebalance. These define how the weights of your selected holdings should be changed or maintained when rebalancing:
Pro-rate: Uses the current portfolio weights
Portfolio: Matches the weightings of a particular portfolio or portfolio group
Model: Uses Portfolio mapping definition. You can define Portfolio mapping within the Rebalance dashboard.
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This article provides example configurations when selecting some rows to rebalance across for common use cases:
Spend a cash amount across selected holdings
“I have holdings in AAPL, AMZN and CMCSA with current portfolio weights of 5.3%, 4.33% and 1.12% respectively. I want to spend 1,000,000 USD of my existing cash across AAPL, AMZN and CMCSA in proportion to their current portfolio holding weights”
In this example, the current AAPL, AMZN and CMCSA weights are at a ratio of approximately 5:4:1. With the rebalance dashboard, we can select the three instruments and specify:
Type: Cash to Spend
Value: 1,000,000 USD
Weighting: Pro-rate
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The rebalance run distributes 1,000,000 USD across AAPL, AMZN and CMCSA. This results in an end weight of 30.32%, 24.78% and 6.43% respectively, maintaining the approximate ratio of 5:4:1 because we chose Pro-rate weighting.
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Raise cash by reducing holdings across selected rows
“I want to raise 5% cash in my portfolio by selling my holdings in AAPL, AMZN and INTC in proportion to their current portfolio holding weights.”
In this example, let’s imagine we have 7% cash, and the current AAPL, AMZN and INTC weights are at a ratio of approximately 5:4:1. With the rebalance dashboard, we can select the three instruments and specify:
Type: Portfolio % to Spend
Value: 5%
Weighting: Pro-rate
The rebalance run reduces AAPL, AMZN and INTC to an end weight of 2.58%, 2.12% and 0.55% respectively, maintaining the approximate ratio of 5:4:1. Meanwhile, the portfolio's cash increases from 7% to 12% total.
Meet a cash target by increasing holdings across selected rows
“I want to increase my portfolio cash weight to 10% by selling holdings in AAPL, AMZN and INTC in proportion to their current portfolio weights”
In this example, the current AAPL, AMZN and INTC weights are at a ratio of approximately 5:4:1. With the rebalance dashboard, we can select the three instruments and specify:
Type: Target Cash %
Value: 10%
Weighting: Pro-rate
The rebalance run decreases holdings in AAPL, AMZN and INTC while maintaining their weights at a 5:4:1 ratio, releasing cash to bring the level to 10%.
Meet a total portfolio exposure percentage by increasing holdings across selected rows
“I want to meet a total portfolio exposure percentage of 90% by increasing my holdings in AAPL, AMZN and INTC in proportion to their current portfolio weights”
In this example, the current AAPL, AMZN and INTC weights are at a ratio of approximately 5:4:1. With the rebalance dashboard, we can select the three instruments and specify:
Type: Target Portfolio Exposure %
Value: 90%
Weighting: Pro-rate
The rebalance run spends cash to increase holdings in AAPL, AMZN and INTC in the ratio 5:4:1. This results in a total portfolio exposure percentage of 90%.
Meet a combined exposure percentage target across selected rows
“I want to meet a combined exposure target of 50% across my holdings in AAPL, AMZN and INTC in proportion to their current portfolio weights”
In this example, the current AAPL, AMZN and INTC weights are at a ratio of approximately 5:4:1. With the rebalance dashboard, we can select the three instruments and specify:
Type: Selected Exposure %
Value: 50%
Weighting: Pro-rate
The rebalance increases holdings in AAPL, AMZN and INTC while maintaining the 5:4:1 ratio. The proposed orders increase the combined resulting end weight for AAPL, AMZN and INTC to 50%.
Redistribute my current exposure across selected rows
“Without spending cash, I want to redistribute exposure across my holdings in AAPL, AMZN and INTC in proportion to a model ratio of 3:5:7”
In this example, the current AAPL, AMZN and INTC weights are at a ratio of approximately 5:4:1, with a current total exposure of 50%. With the rebalance dashboard, we can define a Portfolio mapping with models and rebalance configuration rules. We can then select the three instruments and specify:
Type: Existing Exposure
Weighting: Model
The rebalance redistributes holdings in AAPL, AMZN and INTC to match the model weights defined in the portfolio mapping. This results in their end weights shifting to the model ratio of 3:5:7 whilst maintaining a combined exposure of 50%.