Changing Location and Allocated Space to VM and Parallels

Hi Guys,
I am a novice to Parallels. I have recently installed and started working with Parallels Desktop for Mac 8. I have installed Parallels on my Mac Book Pro and have given the installation location as the hard disk of MacBookPro. I have also allocated a space of 100GB for it on my hard disk. Now when I am installing more n more windows applications on it, guess the space of 100 GB is getting a bit crampy. I want to move the installation folder to my external HD which is 2TB and want to increase the allocated space to say 500 GB.

I would appreciate if someone can advise me, how to go about it.
Any help would be appreciated.

Thanks... Murtaza.