Risk and expected return
Higher possible return usually comes with greater uncertainty or a greater chance of loss. Expected return is an estimate, not an entitlement.
Diversification and concentration
Spreading exposure can reduce dependence on one outcome, but correlated assets may fall together and diversification cannot eliminate market risk.
Liquidity and volatility
Liquidity affects whether a position can be entered or exited near an expected price. Volatility describes variability, but it does not fully capture permanent loss or operational failure.
Time horizon and compounding
Your time horizon influences which fluctuations you can tolerate. Costs and losses compound too, so projections should include conservative assumptions and multiple scenarios.