Personal Finance & Money Stack Exchange is a question and answer site for people who want to be financially literate. Join them; it only takes a minute:

Sign up
Here's how it works:
  1. Anybody can ask a question
  2. Anybody can answer
  3. The best answers are voted up and rise to the top

I.e., $100 decreased by 20% requires an increase of (1/(1-0.2))-1) to return to $100. Is there a simple name that refers to this?

share|improve this question
Is this about leveraged ETFs? :) – fennec Mar 1 '11 at 6:43
up vote 6 down vote accepted

Well, in math terms, it's the reciprocal. A 20% drop (80% of original value) needs a 25% increase to break even. .8 and 1.25 are reciprocals.

share|improve this answer
Ha. Yeah, I guess it is that simple. Thanks. – tgrass Mar 1 '11 at 13:54

Your Answer


By posting your answer, you agree to the privacy policy and terms of service.

Not the answer you're looking for? Browse other questions tagged or ask your own question.