Rebalancing Strategies for High-Net-Worth Portfolios

Consider a high-net-worth individual, Jamie, who has a diversified portfolio of equities, fixed income, and alternative investments. With the recent volatility in the equity markets, Jamie's portfolio has drifted significantly from its target asset allocation of 60% equities, 30% fixed income, and 10% alternatives. To maintain the desired allocation, a rebalancing strategy needs to be employed.

Discuss the various rebalancing strategies available to Jamie, including periodic rebalancing and threshold-based rebalancing. Analyze the advantages and disadvantages of each method, considering factors such as transaction costs, market conditions, and the potential impact on portfolio performance.

Finally, recommend an appropriate rebalancing strategy for Jamie, taking into account her risk tolerance, investment goals, and the current market environment.