Understand a three-fund portfolio and rebalancing: test your skills
US stocks, international stocks and bonds — a simple mix — plus a rule for keeping it on target. Answer each question to see the explanation; your score appears at the end.
This test checks that you can
- Describe the three-fund portfolio
- Choose a stock and bond split based on timeline
- Rebalance with a calendar or threshold rule
- Practice
1. The three funds are…
- Practice
2. Rebalancing means…
- Practice
3. In a taxable account, a tax-friendly way to rebalance is…
- Key idea
4. Which statement best explains "Simple can be enough"?
- Key idea
5. Which statement best explains "The stock/bond split matters most"?
- Key idea
6. Which statement best explains "Rebalancing is buy low, sell high by rule"?
- Action plan
7. In the action plan, which step comes first?
- Mistake to avoid
8. Which of these is a mistake this lesson warns against?
- Mistake to avoid
9. Which of these is a mistake this lesson warns against?
Target 70% stocks / 30% bonds. You have $77,000 stocks and $23,000 bonds. How much should move to bonds?
Show the answer
$7,000
Total $100,000. Target bonds $30,000. $30,000 − $23,000 = $7,000.
Write your target mix and the date you will check it each year.
More tests in this bootcamp
- See how compound interest builds over time
- Understand index funds, diversification and fees
- What is an ETF? Understand the basket behind a share
- Compare ETFs and mutual funds without the jargon
- Understand the S&P 500 and what it leaves out
- Explore total market funds and check the overlap
- Understand international diversification and currency risk
- Look beyond the story of a sector or thematic fund
- Understand a three-fund portfolio and rebalancing
- Learn dollar-cost averaging: a schedule instead of market timing
- Final exam: Funds and portfolios