The rebalancing of a portfolio involves both time, and transaction costs. Therefore, portfolios should be reviewed regularly for changes in material events in the individual investor's personal circumstances; and the relative appeal of the various portfolio components as market conditions evolve. Typically, asset mix decisions are made for one year at a time.

Two of the most commonly referred to asset allocation techniques are strategic and tactical asset allocation.

• Strategic asset allocation is based on data covering the clients investment horizon and dictates which asset groups should be emphasized or underweighted in the portfolio. The higher that an individual's aversion to risk is, the smaller the allowed deviations from the strategic allocation should be.
• Tactical asset allocation involves temporarily departing from the strategic weighting's in order to benefit from temporary imbalances in the securities markets.

The success of the portfolio manager is measured by comparing the total return of the portfolio to comparable benchmark portfolios. The most common calculation is based upon total return divided by the average amount invested.