Glossary term
Deployable cash
Definition
Settled, unleveraged dry powder. The only cash figure this classroom will study a size against.
How it works
Deployable cash is settled, unleveraged cash: money that has finished changing hands and that you hold outright, without a loan in the mix. The course calls it powder because it is finite and physical. Spend it and there is less of it, with no one to consult to find out how much remains.
Each word does work. Settled matters because proceeds from a sale can appear in a cash field before the transfer has actually completed; a figure that moves the instant you act describes intent, while one that moves after settlement describes cash. Unleveraged matters because borrowed capacity is not yours. In the classroom book this figure is the CASH line, $10,000 of the $100,000 model.
Worked example
Suppose the model wants to study a line sized at 10% of the book. Measured against the whole book, 10% × $100,000 = $10,000. Measured against deployable cash, $10,000 ÷ $10,000 = 100%.
Same commitment, different denominator. Against powder, that so-called 10% idea uses every dollar of dry cash the model has. Now add a hypothetical $2,500 sale made this morning that has not yet settled: the dashboard may show $12,500, but deployable cash is still $10,000 until the transfer completes.
Hypothetical, for education only. Not a recommendation and not a prediction.
Common mistake
The mistake is to ask "percent of what?" too late, or never. A size like "10%" is incomplete until the base is named, and the base most often chosen is the most flattering one. Treating any cash-looking figure as powder makes every later judgement about room, concentration and survivable loss start from a number that has already been quietly scaled.