The Fear and Greed Index and Portfolio Rebalancing
Rebalancing means restoring your target mix by selling what has run up and buying what has lagged.
Sentiment extremes can add useful context.
1
Back to target
Trim winners, top up the laggards.
2
Sentiment cue
Greed is a natural moment to trim risk.
3
Discipline
Rules beat emotion when you rebalance.
Source: CFGI
Stocks