Constant Ratio System: Unlike the constant naira system, the same percentage of funds is divided between different assets. When the balance is upset, is periodically restored by moving money from over-performing assets to under-performing ones. This system prevents one assets class from dominating portfolio. This is one way to maintain a desirable asset allocation. Variable Ratio System: This is a variation on constant ration system that relies on market timing to shift the proportions of the various asset classes contained in the portfolio. Buying low and selling high is built into this strategy, but, like the constant naira system, prolonged movement in a given direction will harm returns. Bottom-up Analysis: This is a name for investing strategy that focuses on the fundamental of individual stocks as opposed to the state overall economy.
