Loss recovery calculator: gain needed to break even

A position bought for $10,000 is now worth $6,000. It is down 40%, so a 40% rebound should fix it — except it doesn't. A 40% gain on $6,000 is $2,400, which leaves you at $8,400. To get back to $10,000 the investment has to rise 66.67%. The calculator above does this for any pair of values and, if you give it an assumed yearly return, estimates how many years the climb takes.

How to use the calculator

1. Value before the drop — usually what you paid, or the highest value the position or portfolio reached. Which one you pick changes the question: "when am I even on my cost?" or "when is it back to its peak?"
2. Value now — today's market value. You can also enter index levels or share prices; only the ratio matters.
3. Assumed yearly return — a steady rate used only to estimate the time to recover. Leave the default or try a few values; it does not change the gain needed.

The results show the gain needed to break even, the size of the drop, the dollar amount to make up, and the years it takes at the rate you entered. If the value now is at or above the value before, there is nothing to recover and the calculator shows 0%.

The formula

Gain needed = value before ÷ value now − 1

Written with the loss as a fraction L of the starting value, that is L ÷ (1 − L): the rebound is measured against a smaller base than the fall was. For a 40% loss, 0.40 ÷ 0.60 = 0.6667, or +66.67%.

Years to recover = ln(value before ÷ value now) ÷ ln(1 + r)

This solves value now × (1 + r)ⁿ = value before for n. With the defaults: ln(10,000 ÷ 6,000) = 0.5108 and ln(1.08) = 0.0770, so n = 6.6 years. It assumes the same return every year, no deposits or withdrawals, and no taxes or fees.

The asymmetry grows quickly. Every row below matches what the calculator shows for those inputs:

Drop	Gain needed	Years at 7% a year	Years at 10% a year
−5%	+5.26%	0.8	0.5
−10%	+11.11%	1.6	1.1
−20%	+25.00%	3.3	2.3
−30%	+42.86%	5.3	3.7
−50%	+100.00%	10.2	7.3
−70%	+233.33%	17.8	12.6
−90%	+900.00%	34.0	24.2

The 7% and 10% rates are illustrative steady returns, not expectations for any investment.

Small losses are nearly symmetric; past about −30% the required gain runs away. That is the arithmetic case for position sizing and diversification: a portfolio that never falls 50% never needs to double.

Worked examples with real index data

The line below shows how far the S&P 500 sat below its January 2022 record at each month-end until it was back above it.

	%
Dec 2021	-0.6
Jan 2022	-5.9
Feb 2022	-8.8
Mar 2022	-5.5
Apr 2022	-13.9
May 2022	-13.9
Jun 2022	-21.1
Jul 2022	-13.9
Aug 2022	-17.5
Sep 2022	-25.2
Oct 2022	-19.3
Nov 2022	-14.9
Dec 2022	-20
Jan 2023	-15
Feb 2023	-17.2
Mar 2023	-14.3
Apr 2023	-13.1
May 2023	-12.9
Jun 2023	-7.2
Jul 2023	-4.3
Aug 2023	-6
Sep 2023	-10.6
Oct 2023	-12.6
Nov 2023	-4.8
Dec 2023	-0.6
Jan 2024	1

Our calculation from FRED series SP500 (price index, no dividends). The October 12, 2022 low falls between month-ends, so the deepest point on this chart, −25.2% in September, is slightly shallower than the daily −25.43%.

FINRA describes a correction as a reversal of at least 10% and a bear market as a decline of about 20% or more in a broad index. In the calculator's terms, a correction needs at least +11.11% to undo, and a bear market at least +25%. For every S&P 500 bear market since 1929 and how long each one took to recover, see our max drawdown statistics.

Common mistakes

Dividends. Index levels such as the S&P 500 price index exclude dividends, so the investor who reinvested them got back to even earlier than the price chart suggests. For your own holdings, use values that include dividends received.

Taxes, fees and inflation. The calculator works in nominal pre-tax dollars. A loss you realize in a taxable account may offset gains on your tax return, which our guide to tax-loss harvesting and the wash-sale rule covers; a nominal recovery can still be a loss in purchasing power.

Beyond a single position

The calculator handles one before-and-after pair. Your portfolio has many positions bought at different times. After you import your history, GetHossa shows each holding's realized and unrealized gains against your actual cost, and the portfolio vs S&P 500 comparison shows how deep your own drawdown was next to the index over the same dates. To turn a recovery into a yearly rate after the fact, use the CAGR calculator.

The calculator only does arithmetic on the numbers you enter. It does not predict when, or whether, any investment will recover, and nothing here is investment advice.