Now is a good time to rebalance your portfolio. Why? There are a few really good reasons to rebalance at the year's end.
Put simply, rebalancing buys shares of the year's losers and sells shares of the year's winners -- a form of buying low and selling high. The end of a calendar year works well for this type of portfolio management. 12 months is a sufficient frequency because the value of most of your mutual funds will not dramatically fluctuate (in most years) and you want to limit trading costs. Therefore there is not much reason to rebalance more often than once per year.
Also, you will want to pay special attention to the account type for tax reasons. For example, selling mutual funds in a regular brokerage account, which is taxable, may generate capital gains or capital losses. Shares held less than one year will generate short-term capital gains (or losses) and shares held more than one year will generate long-term capital gains (or losses). Therefore you may want to take advantage of tax loss harvesting, which will minimize capital gains taxes by offsetting them with capital losses.
For example, if you have $1,000 of capital gains and $1,000 of capital losses (whether they are short-term or long-term) the gains and losses will offset each other and there will be no taxes incurred.
You should also know about asset location, which is the planning of locating tax-efficient funds in taxable accounts and the less tax-efficient funds in tax-deferred accounts, such as IRAs and 401(k)s.