How this number is made
Drawdown is the trough minus the peak, divided by the peak. The trough has to be a later low. This page does not search a series for the worst peak. You bring the two numbers. Recovery is not the same percent in reverse: a 25% drop takes a 33% rise to get back.
- Use the same unit, an index level or the account value.
- If the trough is not below the peak, there is no drawdown in the numbers you typed.
Formula
Drawdown = (trough − peak) ÷ peak. Gain to recover = peak ÷ trough − 1.
Worked example
With the figures already in the form, drawdown is -25.0%.
Questions
Why is the recovery larger than the drop?
Because the rise is measured off the smaller number. Losing a quarter of 100 leaves 75. Getting back to 100 is a gain of one third.
Is this the savings drawdown page?
No. That page asks how long a pot lasts when you spend it. This one is a percent drop in a mark.