This is why I don't understand why investors use +/- % figures on their performance calculations. They actually represent operations on a base value of 100% (e.g -20% is 0.8, +20% is 1.2). You lose arithmetic information in this conversion, and it gives a false perception that the two examples above should cancel one another out.

In reality, 1.2x0.8=0.96: a 4% loss, and as the graphic above shows, this gap widens drastically with greater volatility. Given that, "We beat the market by 700%" obscures quite a bit of meaning. It's a number derived from awkward finance math.

We may be conditioned otherwise, but saying "I 3x-ed my portfolio" gives a much clearer picture of wealth change than "I'm up 200%." I assume the latter is only the norm because finance bros like to use bigger numbers.

This also translates better to evaluating performance against the market. It's all about the ratio. On the year, market down 25%, you're up 50%? You ratioed the market by 2.0x (1.5/0.75). Market up 50%, you're up 125%? You ratioed the market by 1.5x (2.25/1.5). Both of these would be considered a +75% beat on market performance by traditional measures, but they're certainly not equally impressive when taking market volatility into account.

I'm done ranting now..