Betterment’s automatic rebalancing feature is available across its investing accounts. Note that rebalancing methods vary according to account type. Below you will find the rebalancing methods unique to crypto.
We adjust your portfolio based on your account balance and market movements to help manage risk. Once you meet or exceed the threshold balance, you can expect the following:
If drift is less than or equal to 15%, a constrained rebalance may occur. Betterment crypto accounts hold approximately 2% of their assets in a USD cash allocation. To prevent unnecessary asset liquidation, Betterment’s monthly management fee is pulled from this portion of the portfolio. If your cash allocation exceeds the 2% target weight, we will use excess USD to purchase underweight coins. If your cash allocation drops below the target weight, we will only sell overweight coins in an attempt to return your USD balance to the 2% target weight.
If drift surpasses 15% and we are able to reduce it by at least 10 percentage points, then unrestricted rebalancing will be triggered. We will both buy and sell coins to bring you closer to your target allocation.
Please note that trading fees are charged on rebalancing (up to 0.15% per transaction).
At this time, rebalancing cannot be turned off within crypto accounts. Furthermore, if rebalancing occurs within your crypto account, we are unable to estimate any tax implications. We intend to offer more crypto features in the future and appreciate your patience in the meantime.
The above material and content should not be considered to be a recommendation. Investing in digital assets is highly speculative and volatile, and only suitable for investors who are able to bear the risk of potential loss and experience sharp drawdowns. Digital assets are not legal tender and are not backed by the U.S. government. Digital assets are not subject to FDIC insurance or SIPC protections.