rpetrocelli:

I another thread, the question came up whether rebalancing is market timing, or whether it is a form or ensuring that your portfolio is at its intended risk level.

Whether rebalancing is market timing depends on the definition of market timing.  For example, according to another post:

"Market timing is defined as situations where the investor is out of the market, partly or in whole, and then buys back in."

As long as the rebalancing keeps the money in the market, it is not market timing.

rpetrocelli:

When we discuss rebalancing, the term "buy low, sell high" comes up.  Indeed, I believe I have seen this term used in books on the DH reading list.  This seems to imply that rebalancing is a way of maximizing returns.

Yet, every study I can recall states that rebalancing over long periods actually lowers returns.

The effect that rebalancing has on returns depends on the time period and the investments being rebalanced.  For example, using the annual returns of the Wilshire 5000 and EAFE indexes from 1970 (as far back as they go) to 2007, a 50/50 annually rebalanced portfolio had a compound annual growth rate of 11.62% while an unrebalanced portfolio had a compound annual growth rate of 11.33%.  Over the 38 year period, which seems long to me, rebalancing raised returns.

rpetrocelli:

Doesn't the phrase, "buy low, sell high" mislead newbies?

I don't see how in the context of rebalancing where you sell some of an investment that has increased in value above your target allocation for it and buy some of an investment that has decreased in value below your target allocation for it.  As long as the investment being rebalance from does not only go higher and the investment being rebalanced to does not only go lower, rebalancing tends to sell high and buy low.

Whether we mislead newbies depends on whom you mean by we.