@ChaitanyaC probably meant this thread:
Some broad pointers I considered while building the model:
- What percentage of your PF can you risk allocating to a single stock? (Ties back to how much you know about that specific company)
- What percentage of your PF can you risk allocating to a single sector? (Ties back to how much you know about that specific industry)
- What percentage fall in your PF can you tolerate? (Ties back to your understanding of equities as an asset class - probably there is an additional layer if you are someone who manages other people’s money)
- What are your expected returns from each stock in your PF? (Ties back to your understanding of Opportunity Cost)
I have tried to give some weight to each of these questions in my model. But as @basumallick has rightly pointed out in the thread, the model is not really “accurate”. It wasn’t really meant to be. I only hope that the tool is a right step in the direction towards a logical way to allocate capital.