Saturday morning. Friend's brokerage app open. Two strategies side by side. The wrong starter question.
"Which one do I start with. The 41 percent Smallcap or the 37 percent LargeMid Multi Asset?" Asked him one thing back. What does a 22 percent drawdown look like on the corpus you are about to put in. Not in percent. In rupees. On a Rs 10 lakh book that is Rs 2.2 lakh sitting in the red for the better part of a year. Look at the number. Hold it. Now decide.
-40pct
Stated tolerance on the questionnaire
What most retail investors tick when the form asks the maximum drawdown they could ride through without selling.
VS
-15pct
Revealed panic threshold
What the same investor actually does when the screen prints the number, per the behavioural finance work since Roszkowski and Davey 2010.
Gap between brochure tolerance and bank account tolerance
25pp
The honest starter answer is not a strategy name. It is one number. The deepest hole you can actually sleep through while still adding the SIP every month. Card two shows how the gap eats the realised CAGR.