Understand it with the below example:
If your portfolio earns 50% in one year and then loses 50% the next year,
you are back to the same level, right?
Wrong!
Your two-year return is still a negative 25%.
Here's the calculation. Rs 100 becomes Rs 150 in year one, and then halves
to Rs 75 in year two. So, net-net, you are down from Rs 100 to Rs 75 over
two years, which is a -25% decline.
This seems elementary, but a lot of us miss these simple Maths.
So, as a humble request, do teach basic Maths to your children so that they learn the art of doing some simple calculations in their mind only to arrive at a logical conclusion.
Why we are writing this aspect because in the quest for profit traders forget the brokerage which when added leads them in the loss for the day. We can help you get lowest brokerage and you can speak to us at given phone number in the top portion of the website.