So much love this phrase. This is usually a common phrase you'll hear while investing.The most important part of the phrase is the word “afford”. This has nothing to do with the amount of money you invest, but is actually about “impact”. What would be the impact on you, if your investment were to lose value?
Every investment you make has a risk of not giving you the returns you expect it to give you. The higher the returns you expect, the more risk you generally take to get those returns. Taking more risk gives you the chance at higher returns, while taking less risk reduces your opportunity to get higher returns. Now by finding ways to reduce the impact of risk, you may be able to accept a higher chance of loss.