There Is No Rebalancing Debate
The dispute that isn't.
Same View, Different Words
I was surprised to see Michael Edesess' article, "Does Rebalancing Really Pay Off??," which questioned the value of Bill Bernstein's oft-cited "rebalancing bonus"--the gain that accrues to investors from periodically selling their winning assets and putting the proceeds into their losers. As neither author is prone to mistakes and rebalancing is a straightforward topic, I didn't see how there could be a serious disagreement.
There isn't. Both parties agree on the salient point: Rebalancing works best if the expected returns on asset classes are similar. As they diverge, so do the benefits of rebalancing.