Rebalance is the process of buying or selling various assets in a portfolio in order to achieve or maintain a certain level of return or/and risk.

Rebalancing is an important concept in DeFi, as it can help users to manage their portfolio and ensure that it remains aligned with their investment objectives. For example, if a DeFi portfolio is heavily weighted towards one particular asset, the portfolio may become too risky and may not provide the desired level of return. In this case, rebalancing the portfolio by selling some of the heavily weighted asset and buying other assets can help to diversify the portfolio and reduce its overall risk.

Rebalancing a DeFi portfolio can be done manually or through the use of automated tools, such as rebalancing bots. These tools can help users to manage their portfolio more efficiently and effectively, and they can make it easier to maintain a desired level of risk and return within a DeFi portfolio.

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