At a time when so many "sure" investments have let everyone down, speculative investing sounds like simply throwing money down the drain.

Shell-shocked investors, wishing no medals for bravery, have contented themselves with safer, low-yield choices.

The irony is that times like this also offer the greatest number of high-risk possibilities that could potentially deliver high rewards. That would mean taking a gamble on stocks and funds that could lose whatever money you put in.

Speculative investing, for those who have the fortitude for it, should never involve more than a small portion of your money and should be money that you can afford to lose.

"There are always turnaround situations, but now there are more than usual—also accompanied by a lot of risk," says George Putnam, editor of The Turnaround Letter, of Boston, since 1986. "The key is to distinguish those that are going to turn around, or at least be stable, from those that will end up filing for bankruptcy."

The most important consideration is a company's balance sheet and just how much debt and cash it has, Putnam says. A firm with a lot of cash will have a "much longer runway" for its turnaround efforts to take off, he says.

"Investors underestimate the risk-versus-reward scenario in speculative investing," Putnam says. "If you're willing to lose all your money on a risky investment, you'd better be sure that on the upside you'll make three to four times your money, or it's just not worth it."

Putnam has been examining the riskiest of the risky—the airline and automotive industries—to find stocks he considers worth taking a chance on.

"An area I do like is the airlines, all of which have been beaten down to very low levels," says Putnam, who says he has observed constructive change in the way they're handling their business. "In the past, airlines would expand rapidly during good times only to get crushed in downturns, but this time around they've been much more disciplined."

His favorite airline stock is U.S. Airways Group Inc. (LCC), which he believes has done a good job of integrating its America West merger over the past several years. It also has less international exposure than competitors, he notes. That's positive because international is often the last part of the airline business to bounce back after hard times.

To a lesser degree, he also likes the stock of AMR Corp. (AMR), parent of American Airlines; Delta Air Lines Inc. (DAL); UAL Corp. (UAUA), parent of United Airlines; and Southwest Airlines Co. (LUV).

Investigating the most troubled endeavor of them all, the automobile industry, Putnam sees some potential. He likes stock in Ford Motor Co. (F) because it is going to be a survivor. But he expects little left for shareholders of bankrupt General Motors Corp. (GM) "once the government is done with it."

Another automotive-field stock that Putnam likes is tire maker Goodyear Tire & Rubber Co. (GT), which had been restructuring its operations for several years before the economic downturn. The stock was slammed even though the firm's operations are much healthier than in the past. Regardless of whether people buy new cars, they're going to have to buy tires for their cars, he reasons.

"Goodyear is not completely out of the woods yet because it is tied to an industry that isn't healthy right now," Putnam says. "So that puts it in the middle of the risk spectrum."

For would-be speculators wary of betting on an individual stock or bond, there are opportunities in exchange-traded funds that hold a pool of stocks or bonds in a specific category and spread out the risk.

"The major fixed-income indices have recovered very well, while certificates of deposit and money-market funds are paying dismally low rates right now," notes Tom Lydon, editor of etftrends.com and president of Global Trends Investments in Newport Beach, Calif. "If there are signs of economic recovery, it will bode well for the corporations that are issuing bonds."

For investors willing to speculate on lower-quality bonds that benefit from an improved economy, Lydon sees potential in some high-yield ETFs: iShares iBoxx $ High Yield Corporate Bond (HYG); SPDR Barclays Capital High Yield Bond (JNK); and PowerShares High Yield Corporate Bond (PHB).

"Financials are off 'death watch,' but the risk is there's no growth going forward," says Scott Burns, director of ETF analysis for Morningstar Inc., in Chicago. "Now, the regional banks are suspect due to their ties to commercial mortgages."

But investors bullish on an economic revival might consider SPDR KBW Regional Banking (KRE), an ETF that tracks the index of regional banks and avoids the biggest names such as Citigroup Inc., Burns says. Those same investors would probably also take a close look at iShares FTSE NAREIT Retail Capped Index (RTL), an ETF providing exposure to the retailing industry, he says

The world's reviving emerging markets also offer speculative potential. Morningstar recently added the ETF WisdomTree Emerging Markets Small Cap Dividend (DGS) to one of its model portfolios, while Lydon sees opportunities in iShares MSCI Emerging Markets Index (EEM) based on its investments in China, Brazil, and Eastern Europe.

Just don't stash the family nest egg or college fund in these possibilities.