Short answer: No. But let’s break it down…

In investing, we can think of return as performance and drawdown as variability. The goal? Maximize returns while minimizing variability—a concept often referred to as risk-adjusted returns in finance.

Looking at the past five years, we’ve had a major market correction, offering a chance to observe the relationship between return and drawdown. As TQQQ allocation increases from 0% (SPY only) to 40%, return rises from 14% to 35%. At the same time, drawdown increases from 18% to 43%.

The takeaway? Higher returns come with higher drawdowns.

But does a higher drawdown mean higher risk? Not necessarily. In a buy-and-hold strategy, accuracy is 100%—meaning that drawdowns don’t translate into losses, just temporary pauses in portfolio growth. Historically, portfolios reach new highs within two years after market bottoms.

Key insight: The key is managing variability, not fearing it.

Would love to hear your thoughts—how do you balance performance and variability in your investment strategy?