High volatility of returns is a drag on long-term performance.

The bottom line is this: averaging returns does not tell you what you get in the end. The only number that matters is the rate of compounding, the compound annual growth rate (CAGR).

Paradox: Gaining More by Losing Less

Well, it’s not really a paradox. It’s just math, but still, Alliance Bernstein explains:
[pdf width=”100%” height=”900px”]https://s3.amazonaws.com/wc-pdf-2013/compounding-ABTheParadoxofLow-RiskStocksGainingMorebyLosingLess.pdf[/pdf]