How does my portfolio transition to a new allocation?

For Taxable Investment Accounts:

When you change your risk level or customize your allocation, it takes time to transition to your new target allocation — and varies based on your current holdings and any tax implications.

Our software normally buys and sells investments in a way to help minimize taxes, so your allocation may differ from your target allocation for an extended period of time — particularly if you have a lot of embedded capital gains in your account.

When you make new deposits, receive dividends or when overweight asset classes subsequently trade at a loss, we’ll use these opportunities to transition your account to your new allocation.

If your taxable account is over $5,000, you can choose to transition your portfolio sooner, which typically happens within 1-2 trading days. This may incur more taxes. To do this, when you submit your new allocation, click Update transition preference and Transition sooner.

For IRA or 529 Accounts:

When you update your allocation in an IRA or 529 College Savings Plan, your portfolio will typically reflect your new allocation within one trading day.

For all account types:

Our software is designed for long-term investing, so if you’re frequently changing your risk level or customizing your allocation, those changes may not be reflected immediately.

Was this article helpful?