# Weight Update

The primary mechanism for portfolio rebalancing is an update of the underlying [balancer-managed-pool](https://docs.aera.finance/v1-archive/concepts/aera-vault/balancer-managed-pool "mention") weights using Balancer's `updateWeightsGradually` function.

### How weight updates contribute to efficient rebalancing

There are several mechanisms that can facilitate portfolio rebalancing on-chain. An auction mechanism is the most popular alternative and allows a set of bidders to make price quotes. The problem with auction mechanisms for frequent rebalancing is as follows:

* Auctions are overly sensitive to current market price,
* Auctions restrict participation to larger pools of capital and infrastructure to identify and participate in the auction.

Instead, Aera elects to rebalance portfolio using a Balancer Managed Pool by using weight schedules that steadily change the spot price over time. This has several benefits:

* Many more market participants are participating in Aera trading (even unknowingly, for example by using trade routing services),
* Rebalancing is spread out over time, retaining some of the benefits of TWAP trading.


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