Long-term Investment in Volatile StocksFood for thought. It feels like we are suffering from volatility drag in the span of weeks vs. the usual years.
Volatility also eats into your returns long term. Although volatile portfolios are more likely to have higher returns in good years, they are also more likely to have higher losses in bad years. What this means is that, over time, your portfolio is growing from a smaller starting point. This concept — known as “volatility drag” — is crucial for understanding why volatility can be bad for your long-term wealth.
https://farmtogether.com/learn/blog/why-volatility-can-be-bad-for-long-term-returns