Drawdown and recovery calculator

Why gaining back what you lost is not enough

Once you lose, any later gain is calculated on a smaller capital, so the same percentage no longer returns the same money. Recovering therefore always takes a larger percentage than the one lost, and the difference grows sharply as the drawdown deepens.

Gain needed % = Drawdown % ÷ (100 − Drawdown %) × 100

A worked example

From €10,000 you lose 20%: €8,000 remains. To get back to €10,000 you have to gain €2,000, and €2,000 on €8,000 is 25%, not 20%. Had the drawdown been 50%, €5,000 would remain and another €5,000 would be needed: 100%.

Frequently asked questions

Why does a 50% loss take a 100% gain?

Because after losing half, getting back to the start means doubling what is left. The loss is measured against the starting capital and the recovery against the surviving one, which is smaller: that difference in bases is the whole explanation.

Is this the same as maximum drawdown?

Maximum drawdown measures the largest fall from a peak to a trough in a track record. This calculator answers the next question: given that fall, what it takes to undo it. They are used together but they are not the same measure.

Is the number of trades a forecast?

No. It assumes every trade contributes exactly the same percentage, which does not happen in practice. It is there to give a sense of the scale of the effort, not to plan a timetable.

Other calculators

• Position size (lots)
• Risk/reward (R:R)
• Pip value
• Margin / leverage
• Market sessions
• Break-even point