What happens if the market drops 20%?
A risk question asks how much of a portfolio depends on one thing going right — a single position, a sector, a country. Concentration is read as a share of the total, which is what the figures below show.
Worked through on a sample portfolio. The figures below are that portfolio’s, not yours.
You asked what happens if the market drops 20%. I’ll run a simple scenario applying a -20% shock to equities and ETFs (applied to today's holdings at their current values), leave cash unchanged, gold unchanged, and apply the shock direction appropriate to crypto and any inverse/leveraged products (none here). No buying/selling, exchange rates unchanged, no dividends.
Assumptions:
- Equities (all Stock positions) and ETFs (all ETF positions) fall -20% from today's values.
- Crypto holdings fall -20%.
- Cash unchanged.
- Gold unchanged.
- Scenario applied to today's holdings; no trades, no dividends, exchange rates fixed.
Result (hypothetical scenario):
| Asset | Value today (€) | Value in scenario (€) |
|---|---|---|
| Stock | 44.666,25 € | 35.732,, (note: calculated as 49,09% * 90.983,96 € ×0,80) |
| ETF | 28.397,93 € | 22.718,34 |
| Crypto | 7.833,76 € | 6.267,01 |
| Precious metal | 4.575,79 € | 4.575,79 € |
| Cash | 5.510,23 € | 5.510,23 € |
| Total portfolio value | 90.983,96 € | 73.863,17 € |
What this means:
- In this scenario your portfolio would hypothetically fall from 90.983,96 € to 73.863,17 € (a -17,119.79 € change).
- Cash and gold stay the same; equities, ETFs and crypto each lose -20% of their current value.
- The numbers shown are hypothetical and depend on the assumptions listed.
Would you like the scenario rerun with different shocks per asset class or with gold falling too?
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See this for your own portfolio
The assistant answers the same question about your own holdings, with your figures and today’s prices. Import from your broker, or open the demo portfolio and ask it there.