Drawdown Recovery Calculator
A loss and the gain needed to undo it are never the same number. Enter the size of the decline to see the real gain required, and roughly how long it could take.
Loss and recovery reference
The gain required after declines of different sizes.
| Decline | Gain required to break even |
|---|---|
| 5% | 5.26% |
| 10% | 11.11% |
| 20% | 25% |
| 30% | 42.86% |
| 40% | 66.67% |
| 50% | 100% |
| 60% | 150% |
| 70% | 233.33% |
| 80% | 400% |
| 90% | 900% |
Formula and method
Required gain: d ÷ (1 − d), where d is the decline as a decimal, turned into a percentage.
Estimated recovery time: ln(1 ÷ (1 − d)) ÷ ln(1 + r), where r is the assumed annual return. It assumes that return stays constant and nothing more is added.
Losses and gains aren't symmetrical because the gain is always measured against the smaller balance left after the loss.
Worked example
A €100,000 portfolio falls 50% to €50,000.
Required gain = 0.5 ÷ (1 − 0.5) = 1.0 = 100%.
At an assumed 7% a year, that recovery takes roughly ln(2) ÷ ln(1.07) ≈ 10.2 years, with no further money added.
FAQ
Frequently asked questions
Why does a 50% loss need a 100% gain to break even?
Because the gain is measured against the smaller, post-loss balance. €100 falling 50% leaves €50, and getting from €50 back to €100 is a 100% increase, not 50%.
What's the formula?
Required gain = drawdown ÷ (1 − drawdown), as a percentage. A 20% fall needs 0.2 ÷ 0.8 = 25% to get back to even.
Why is a 100% loss impossible to recover from?
The balance is zero, and no percentage gain applied to zero gets you anywhere. There's no finite number that fixes it.
How long will recovery actually take?
Depends entirely on the return you assume. Enter one and the calculator estimates the years needed at that constant rate - which real markets won't actually deliver.
What if I keep adding money while recovering?
Not accounted for here. This only measures the return needed from the existing balance. New contributions speed things up, but that's a different question from recovering the loss itself.
More free tools