This in my opinion goes back to the original suggestion of how DWEX should be viewed.
It was in my opinion never meant to be something that was either magic, nor did anybody suggest that it will never be exposed to long periods of stagnation or drawdowns.
The FTSE 100 was merely picked to base the idea upon - and the S&P500 could perhaps be a better suited example:
In addition to this, you can see below a summary of the biggest daily % gains and losses on the S&P500 historically:
I think it's therefore interesting to note that the DWEX loss in this instance is roughly within the parameters of the bigger losses experienced within the S&P500.
The key is, as is the case with the S&P500 - DWEX will need to have the ability to recover form these losses, and of course, you should also have days where there are big positive swings.
I'm obviously showing some bias towards this idea - but I still feel that this is on the right track.