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Mid-Year Approaching: How to Prepare Your Semi-Annual Portfolio Review
Key takeaways
- The semi-annual review is an opportunity to verify whether your portfolio still fits your goals and investment horizon.
- Rebalancing is not about predicting the market — it is about maintaining your originally chosen allocation.
- Check fees, dividends and your tax situation before the half-year ends.
- Write down three questions: What has changed in my life? What has changed in the portfolio? Does one reflect the other?
- If they no longer align, adjust — but slowly and deliberately, not impulsively.
A semi-annual portfolio review is a structured check-up in which you verify whether your investments still match your goals, time horizon and risk tolerance — regardless of what the market has been doing.
Why mid-year specifically?
Year-end tends to be full of emotions, tax deadlines and conversations about the "outlook for next year." June is quieter. You have enough data from the past six months and still enough time to make any adjustments before the year closes out. There is no magic to it — it is simply a good habit.
What exactly to check
- Allocation: Has any asset class grown so much that it has distorted your original intention? If you started with 80% equities and 20% bonds, the ratio may be different today.
- Fees: Are you paying more than you need to for your funds? Compare the TER (Total Expense Ratio) across your positions.
- Dividends and income: Are you reinvesting automatically, or is cash sitting idle in your account?
- Tax situation: Do you have positions with a loss that can be used for tax purposes? In the Czech Republic, a three-year holding period exempts capital gains from income tax.
- Life changes: Has a child been born, has your job changed, is a major expense approaching? Your portfolio should reflect your real life.
Rebalancing: yes or no?
Rebalancing does not mean speculating about what the market will do next. It means returning the portfolio to its originally chosen allocation. There are two methods: threshold rebalancing (you act when allocation drifts by more than 5 percentage points) and calendar rebalancing (once a year or semi-annually regardless of drift). Both work — what matters is having a clear plan in advance. For more on allocation fundamentals see the article how to build your first portfolio.
How to document your review
Create a simple table or note: current allocation vs. target allocation, total capital invested vs. market value, three questions (what has changed in your life, what has changed in the portfolio, what follows from that). The output should be concrete: "no changes," "I will buy more X," "I will reduce the fee of fund Y." Consistency matters more than perfection. For a deeper understanding of risk, read the article what is risk and how to measure it at all.
FAQ
How often should I review my portfolio?
For most investors, once or twice a year is sufficient. Too-frequent check-ins lead to impulsive decisions. June and December are natural stopping points — enough data, time to adjust.
What is rebalancing and do I have to do it?
Rebalancing is returning the portfolio to its original allocation after it has drifted due to market movements. It is not mandatory, but it helps maintain the level of risk you were originally comfortable with. Choose either a threshold or a calendar method.
Do I have to sell something during a review?
Not always. If you are adding new money, buying more of the underweight asset class is a cleaner solution than selling — in the Czech Republic you also avoid a taxable event for positions held less than three years.