I was thinking about how to diversify a portfolio of investments and started scribbling a few diagrams down.
I want to plan a diversified portfolio of stocks/investments so there maybe either a 50/50 weighting of riskier/high reward type stocks against low risk, low reward stocks. I might even weight this so its 60/40.
I came up with a risk/return quadrant with the quarters filled with companies which I think would fit the above categories. I then split this into 3 rows of 3 cols to get finer granularity. Are there any other techniques for doing this kind of thing? If so, are there any refrences on the net?
I'm particular interested in knowing how best to weight the investments and how to place what stocks in what squares.