Calculator
What it takes to get back
Drawdown recovery
Set the fall; the calculator does the restFalls that actually happened
The annual return you assume while recovering.
Gain needed to get back
+42.9%
Years at 7.0%
5.3
A fall and the gain that undoes it are not the same number, because the gain is calculated on the smaller amount that remains. Lose half and you need to double what is left. This is arithmetic rather than opinion, and it is the most commonly misjudged relationship in investing. Recovery times assume a constant return, no further falls, and no charges or tax, none of which is realistic; they are a floor, not a forecast.
The full ladder
Every fall, the gain that undoes it, and how long| Fall | Gain needed | Years at 4% | Years at 7% |
|---|---|---|---|
| −5% | +5.3% | 1.3 | 0.8 |
| −10% | +11.1% | 2.7 | 1.6 |
| −20% | +25.0% | 5.7 | 3.3 |
| −30% | +42.9% | 9.1 | 5.3 |
| −40% | +66.7% | 13.0 | 7.6 |
| −50% | +100.0% | 17.7 | 10.2 |
| −60% | +150.0% | 23.4 | 13.5 |
| −70% | +233.3% | 30.7 | 17.8 |
| −80% | +400.0% | 41.0 | 23.8 |
| −90% | +900.0% | 58.7 | 34.0 |
Recovery times assume a constant annual return with no further falls, no charges and no tax. Real recoveries are rarely that tidy, so treat these as the shortest plausible path rather than an expectation.
Why the asymmetry exists
A 20% fall on $100,000 leaves $80,000. A 20% gain on $80,000 is $16,000, which brings you to $96,000, not back to where you started. The percentages are measured against different amounts.
The effect is mild at small losses and brutal at large ones. Recovering a 10% fall needs 11%. Recovering a 90% fall needs 900%.
This is the arithmetic behind the common advice to pay attention to how much can be lost rather than only to how much can be gained. It is not a statement about whether any particular investment will fall.
Seen in real markets
The preset falls in the calculator are drawn from index history: the 2020 crash, the 2007 to 2009 financial crisis, the dot-com collapse in the Nasdaq, and the 1929 to 1932 fall in the Dow.
Maximum drawdown for the instruments covered on this site is calculated from actual price history on each comparison and asset page, so you can see what an asset has actually done rather than only what the arithmetic implies.