The base changes
Start with AED 10,000. A 50% fall leaves AED 5,000. A subsequent 50% rise adds only AED 2,500, taking the balance to AED 7,500. To reach the original AED 10,000, the smaller balance must double: a 100% gain. The percentages describe changes from different starting points.
The recovery formula
For a loss expressed as a decimal, the gain needed to break even is loss ÷ (1 − loss). A 20% loss needs a 25% gain; a 40% loss needs about 66.7%. These calculations assume no deposits, withdrawals, fees, or taxes. They describe the arithmetic, not the likelihood or timing of a recovery. A complete loss cannot recover without new capital.
Risk is more than a moving price
Investment risk includes the possibility of losing capital. Price fluctuations matter, but so does whether you can access your money when needed. A higher potential return comes with uncertainty; taking more risk does not guarantee a better outcome.
Time and capacity matter
The money needed for an approaching expense has a different purpose from money set aside for a distant goal. Consider both your willingness to accept losses and your ability to absorb them. A long investment horizon can allow more time to respond to fluctuations, but it does not make every investment safe.
Sources & further reading
Sources checked 13 November 2026. These organisations provide reference material and do not endorse this website.
