Young Research & Publishing Inc.

Investment Research Since 1978

Disclosure

  • About Us
    • Contributors
    • Archives
    • The Final Richard C. Young’s Intelligence Report
    • You’ve Read The Last Issue of Intelligence Report, Now What?
    • Dick Young’s Research Key: Anecdotal Evidence Gathering
    • Crisis at Vanguard
  • Investment Analysis
    • Bonds
    • Currencies and Gold
    • Dividend Investing
    • ETFs & Funds
    • Investment Strategy
    • Retirement Investing
    • Stocks
    • The Efficient Frontier
  • Investment Counsel
  • Dynamic Maximizers®
  • Retirement Compounders®
  • Free Email Signup
  • Dick Young’s Safe America

Can Your Portfolio Take a 50% Loss?

February 27, 2014 By Young Research

It’s impossible to have it all ways. In order to craft an investment portfolio that can act as an all-weather armadillo, you must be willing to forgo potentially substantial upside rewards to balance against the horror of a downside wipeout. If you are retired or saving for retirement in the not-too-distant future, you can easily get a knot in your stomach when you look at the basic math of downside portfolio protection.

By example, when you lose 50% on an investment, you must make 100% the next trip to the plate just to get back even. And that’s without considering the negative drag of expenses and taxes on your gain as well as the fact that you’ll have to overcome the income you pull from your portfolio to meet your income needs. Things can get real ugly—and fast. For a big percentage of investors, the mindset to take a deliberate and laser-focused armadillo-like approach is never achieved. For this unfortunate crowd, the ticking time bomb has already been set. What awaits is the explosion and ensuing financial carnage for the sad family.

arithmetic of portfolio losses

Share this:

  • Email
  • Twitter
  • Facebook

You Might Also Like:

  • Can You Afford a 50% Loss?
  • Why a Balanced Portfolio is a Winner
  • Portfolio Strategy: Looking Past the End of the Bull
  • Author
  • Recent Posts
Young Research
Latest posts by Young Research (see all)
  • Clicks-to-Bricks: Online Retailers Move into Prime Real Estate - March 16, 2018
  • The Enemy of My Enemy is My Friend in the Chip Industry - November 9, 2017
  • Can NatGas Now Crush Coal Without Killer New Regulations? - December 27, 2016

Search Young Research

Most Popular

  • It’s as Simple as 4%? No, Not Anymore
  • Is Inflation Imminent? Prepare Now
  • Your Port Against a Storm.
  • Vanguard Wellesley (VWINX) vs. Wellington (VWELX): Which Fund is Best?
  • Long Live the Dividend King
  • Inflation? Yes.
  • Fidelity Investments #1: Hires 4,000 Focuses on YOU
  • The Power of a Compound Interest Table
  • The Highest Yielding Dow Stocks
  • Banks Prepare for Boom

Don’t Miss

Default Risk Among the Many Concerns with Annuities

Risk and Reward: An Efficient Frontier

How to be a Billionaire: Proven Strategies from the Titans of Wealth

Could this Be the Vanguard GNMA Winning Edge?

Cryptocosm and Life After Google

Warning: Avoid Mutual Fund Year End Distributions

Is Gold a Good Long-term Investment?

How to Invest in Gold

Vanguard Wellington (VWELX): The Original Balanced Fund

What is the Best Gold ETF for Investing and Trading?

Procter & Gamble (PG) Stock: The Only True Dividend King

The Dividend King of the North

You’ll Love This if You’re Dreaming of an Active Retirement Life

RSS The Latest at Richardcyoung.com

  • The Vanguard Wellesley Way
  • Toilet Paper and SPAM: What More You Can Do?
  • Incentivizing People to Stay Home?
  • The Government Cannot Constitutionally Interfere With Gun Ownership
  • French Wine Weather Disaster Worse than 1991, 1997, 2003
  • Key West Breaking News from Dick Young
  • A Pitiful, Helpless Giant?
  • What Happens When Even Logic and Facts Can’t Persuade the Left?
  • Don’t Miss the Boat: Meet Your Money Stewards
  • Hit Piece on Gov. Ron DeSantis Is the End of 60 Minutes’ Credibility

About Us

  • About Young Research
  • Archives
  • Contributors

Our Partners

  • Richard C. Young & Co.
  • Richardcyoung.com

Copyright © 2021 | Terms & Conditions

loading Cancel
Post was not sent - check your email addresses!
Email check failed, please try again
Sorry, your blog cannot share posts by email.