Talking about risks and returns, this brings to another important component investors must know – that is dynamic allocation of assets and periodic rebalancing. Quite often, asset allocation is based on market situation, wherein the portfolio consists of assets allocated dynamically calibrating itself according to the rise and fall of the market. Here, the fund manager exits the underperforming stocks and includes the performing stocks in the portfolio. Also, the portfolio must be reviewed periodically and rebalanced accordingly.