Gain More By Never Losing

When I began investing in the stock market, I didn't understand what needed to be gained to break even after a loss until experience taught me.

Initially it seems like if you've got $1000 and lose 10% you'd be back to $1000 with a 10% rebound, but that's not true, what you'll need is a little over an 11% gain. Why? Well, let's do the math.

1000-10%= 900
900+10%= 990
900+11%= 999

Now let's look at a much bigger loss of 60% with the same $1000.

1000-60%= 400
400+60%= 640
400+150%= 1000

This is why the stock market is a great option for investing your money during the accumulation phase of your life but not a great choice for the distribution phase.