Excessive Trading Costs in Rebalancing
Definition
Time-based rebalancing ignores drift thresholds, leading to frequent trades that accumulate brokerage and other costs.
Key Findings
- Financial Impact: AUD 500-2,000 per client portfolio annually (brokerage on unnecessary trades)
- Frequency: Quarterly or more frequent in volatile markets
- Root Cause: Fixed schedule rebalancing vs. weighting-based triggers
Why This Matters
The Pitch: Investment advice firms in Australia 🇦🇺 incur AUD 500-2,000 per portfolio annually in avoidable brokerage. Threshold-based automation reduces unnecessary trades.
Affected Stakeholders
Traders, Portfolio Managers, Clients
Deep Analysis (Premium)
Financial Impact
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Current Workarounds
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Methodology & Sources
Data collected via OSINT from regulatory filings, industry audits, and verified case studies.
Related Business Risks
Manual Rebalancing Bottlenecks
Unbilled Rebalancing Services
Capital Gains Tax Hits from Rebalancing
ASIC Brochure Non-Delivery Fines
Manual Brochure Preparation Labour Costs
Client Acquisition Delays from Brochure Friction
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