specific time of year to rebalance, is one month better than another?
Frequency - rebalance once or twice per year ?
How much off of the allotted percent of portfolio is the threshold for rebalancing- if target for a stock is 5 % of portfolio, is the cut off for selling and deploying elsewhere - 6 %, 7 % or more?
The right answer can only be known in hindsight but we like to strike a balance between giving companies a chance to run a bit, limiting transaction costs, and taxes. Some like to take a calendar approach and just rebalance every quater or 6 months which is fine. We prefer to focus more on actual allocations. So, when a company or sector hits a certain threshold, then we would look to rebalance, opposed to 'unneccessairly' creating costs just because a calendar date has hit. Of course, one needs to monitor and follow the rebalancing process here. In terms of what ranges to use for allocations, it is more personal but we do prefer to give companies/allocations a bit of 'room to breathe'.
If taking a calendar approach, we would consider quarterly or semi-annually (somewhat depending on if markets have had a big move over a period as well).
For ranges, we think a 1% allocation range (i.e. target 3%, rebalance at 2%/4%) is too tight in most cases and will lead to overtrading. At least a 3% 'band' probably makes sense and then above that depends more on the individual. You can also set different ranges for different holdings. So a tech company might be given more leeway because it is more volatile (don'tnecessarily wan't to trigger a rebalance due to short-term regular market volaitlity) compared to a utility which might have a more narrow range.