Concept: Volatility Drag

Volatility Drag

If you lose 50% of your capital in one year, you’ll need to achieve a 100% return the next year, just to get even. This asymmetry is the cause of the “Volatility drag” - one unit loss will hurt your long-term gains more than one unit gain.

This reason why you want to optimize your portfolio to avoid losses on your capital, rather for extraordinary gains.

The volatility drag could potentially explain the low-volatility anomaly

Read more about it on Wikipedia