Drawdowns from Market Losses Work Geometrically Against You

Investment Drawdowns from Market Losses Work Geometrically Against You

Losses don’t scale linearly—they scale exponentially in how they hurt compounding.

A -10% loss requires +11.1% to recover

A -20% loss needs +25%

A -50% loss needs +100%

A -90% loss needs +900%

Why? 

Because you’re always growing from a smaller base.

That’s the geometric trap: each deeper loss shrinks the capital available to compound. 

You're not just losing money—you're losing the very engine of growth.

It's why ASYMMETRY^® emphasizes risk management first by predetermining exits in advance, monitoring portfolio risk in real time, and hedging with convexity when there's an edge.