Play along with me, here, if you will:
Let's propose that you have a "portfolio" of $100,000.
Some of it is in low-risk, low-return vehicles.
Some of it is in moderate-risk, moderate-return vehicles.
What amount are you personally comfortable with investing in a higher-risk, higher-return vehicle? 10 percent? 20 percent?
The reason I ask:
I've been toying with an "investment model" for my inventory management system that includes "annual return on investment", but also "risk".
When a new line is purchased, generally there is risk involved that they will not sell. Money invested in a new line (although critical to retailing success) could be invested in more safe, proven lines.
So, what percent of your total inventory value are you willing to "put on the table" like chips in Vegas?
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