For building a successful balanced portfolio one has to understand different asset classes and as per their risk appetite, one has to build his or her portfolio from his risk return point of view.
Asset class is grouping of similar investments whose prices tend to move together.
These are different asset classes for investment:
1.STOCK/EQUITIES: It has highest risk and return potential is also higher.
2.FIXED INCOME/BONDS: It has low risk and high return potential.
3. CASH:It has lowest risk but high return potential.
4. REAL ESTATE:
One should use all 4 asset classes to build his/her portfolio.