Using folders to organize your favorites
To create a folder, click on the Organize Favorites menu item and in the Organize favorites window, click the Add Folder button.
Change the name of your folder, then you may drag & drop favorites to the folder.
Moving you favorites around
To change the order of your favorites, to move your favorites to a folder, simply drag & drop them in the Organize favorites window.
NOTE: if you drag a favorite outside of the tree view and drop it in the Organize favorites window, the favorite will be deleted (you'll be prompted to confirm that you want to delete it).