One doesn’t invest their money to lose it, yet markets move and can be surly and volatile, so invested money can be lost in many ways.

The need to sell presents itself for many reasons: I didn’t keep enough liquidity, I’m repositioning assets, or I’m as scared as hell and I’m not going to take it anymore!, to name a few.

It helps to know the loss and breakeven math before you sell. As monolithic as our American educational system may be, many investors forget what they learned in math class and think in emotional shorthand, instead of doing the math when they sell. Or buy, for that matter.

For instance, one may think, “Gee, I lost 10% so when I earn back 1o% I’m getting out!”

Not so fast. Go back and do the math. To kick start the process, take a look at this chart:

That 10% loss requires a 11.1% gain just to get back to even. A 25% loss requires a gain of 33.3% to breakeven. It gets progressively terrifying from there. If you lose 50% you have to earn back 100% to just breakeven. And don’t forget, we’re talking just to BREAKEVEN. From that point, you will need a parade of green arrows on top of the breakeven to make positive returns.

…If you lose 50% you have to earn back 100% to just breakeven…

For a more historical example, look no further than the financial crisis of 2008 that led to the Great Recession. Deregulation of the financial industry allowed Wall Street banks and hedge funds to do some very “creative” financing with derivative contracts tied to mortgages. Go read the history if you are unfamiliar in Michael Lewis’s book or see the dramatized events in the movie The Big Short.

The S&P 500 was down in 2008 (-37%). Go to the chart for the ballpark number. At a 35% loss your portfolio has to earn back almost 54% just to breakeven. In rough numbers it took investors to the end of 2012 just to breakeven. Sadly, many, many people bailed out and missed much or all of the market bounce back since then.

So how do avoid these scary numbers?

Well, for starters, you need a strategic approach like Passive Make investing.

Next you need to craft an allocation strategy that addresses the reasons you are investing in the first place, namely to achieve your financial goals, and start to establish some risk parameters.

Then after you have assembled your team, the individual ETFs that make up your portfolio, and buy them in the ratios required to satisfy your strategic plan, model allocation and location strategy, you need to make some front end decisions about selling. Know your personal “whens” and “whys,” and then learn the math.

And never forget this little bit of genius: It about TIME IN, not TIMING.

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