It doesn’t seem to make any sense at first, but rebalancing is used by portfolio managers all over the world to manage risk and boost returns.

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Data used in this video:

Historical Asset class returns
http://awgmain.morningstar.com/webhel...

Northern Trust risk adjusted returns
https://www.northerntrust.com/united-...

Vanguard Portfolio Drift
https://investor.vanguard.com/investi...

Other reading:
How rebalancing works for Index Investors - https://breakingthemarket.com/why-mar...

00:00 Intro
01:59 Risk vs Return
03:54 Diversification
08:14 Stocks & Bonds
10:45 Within Stocks