/Maximum Drawdown

Search Knowledge Base by Keyword

Maximum Drawdown

A drawdown is any losing period during an investment. It is defined as the percent retrenchment from an equity peak to an equity valley. A drawdown starts with the beginning of an equity retrenchment and continuous until a new equity high is reached.

A drawdown encompasses both the period from the equity peak to the equity valley (length) and the time from the equity valley to the new equity high (recovery).

Maximum Drawdown (Max DD) is then the greatest cumulative percentage decline in equity. Max DD is also available to display in 3M, 6M, 12M, 24M a 36M periods.

Maximum Drawdown Formula

P = Peak value before largest drop
L = Lowest value before new high established

Non compounded Max DD
Our current method for calculating noncompounded Drawdown is “summing all monthly values in a given period”.

Need help? Feel Free to Ask

To make this site work properly, we sometimes place small data files called cookies on your device. Most big websites do this too. Show details Ok

About cookies

What are cookies?
Cookies are small text files that are placed on your computer by websites that you visit. Websites use cookies to help users navigate efficiently and perform certain functions. Cookies that are required for the website to operate properly are allowed to be set without your permission. All other cookies need to be approved before they can be set in the browser.

How to control cookies?
You can control and delete the cookies that are stored on your computer. Please see aboutcookies.org for more information.

Marketing/Tracking

_gat_gtag_UA_*_1 This cookie is used by Google Analytics to store and track conversions.
Retention period: 1 hour.
Domain: www.fundpeak.com

Statistics (anonymous)

_ga This cookie is used by Google Analytics to count and track pageviews.
Retention period: 2 years.
Domain: www.fundpeak.com

_gid This cookie is used by Google Analytics to count and track pageviews.
Retention period: 1 day.
Domain: www.fundpeak.com

Functional

privacy_embeds This cookie is used by Fundpeak to store user privacy preferences.
Retention period: at least one session.
Domain: www.fundpeak.com

Third party

_GRECAPTCHA This cookie is used by Google. reCAPTCHA sets a necessary cookie when executed for the purpose of providing its risk analysis.
Retention period: 6 months.
Domain: www.google.com