Rebalancing is the systematic process of reallocating the assets within a portfolio to keep each asset's share of the portfolio in line with the predetermined percentages. This chapter discusses the methods for rebalancing a portfolio and how often it should be done to produce the best returns. The objective of portfolio rebalancing is to keep each asset's share of the portfolio in line with predetermined allocations. Tax efficiency within the 7Twelve portfolio could be improved if new cash flows into the portfolio, that is, additional money being invested into the 7Twelve portfolio, are used to accomplish the needed rebalance. If done correctly, the rebalancing process would equalize the account value among all 12 funds at the end of each year or beginning of each year, if rebalancing annually. Some investors prefer to rebalance their portfolios monthly, quarterly, or annually and some investors might choose to not rebalance their portfolio at all, which is referred to as the “buy-and-hold” strategy.