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This is interesting. I have often wondered about the wisdom of rebalancing into a falling knife although I have sometimes done it. However, periodically clipping away at winners does make sense to me as a way to preserve some of the gains. I looked through the detailed paper and its comments about momentum but its too complicated for my relatively passive style. The main initial take away for me is to think harder about rebalancing into a still declining market even if the calendar says to do it. Delaying action in that case may be wiser.
Comments
Selling Winners to use (spend) the money makes perfect sense