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Drawdown Calculator

Calculate how much gain you need to recover from a loss. Understand the asymmetric nature of drawdowns.

USD
USD
Recovery Analysis
Gain Needed to Recover
+25%
to get back to $10,000
Drawdown
-20%
Dollar Loss
-$2,000
Need to Gain
+$2,000

Recovery Map

Losses need larger percentage gains to return to the same peak.

Current $8,000
Peak Current Recovery $10,000 $8,000 $10,000 -20% +25%
Recovery needs +25% — see your real drawdown history
You calculated one drawdown. Trader's Second Brain tracks your actual drawdowns across every trade and flags when you're approaching danger zones.

The Asymmetry of Drawdowns

One of the most important concepts in trading is that losses and gains are not symmetric. A 50% loss does not require a 50% gain to recover — it requires 100%.

Recovery % = (Peak - Current) / Current × 100
Lost 20% ($10k → $8k)? You need 25% gain ($8k → $10k) to recover

Drawdown Recovery Table

Loss Gain to Recover Difficulty
-10% +11.1% Easy
-20% +25% Manageable
-30% +42.9% Challenging
-40% +66.7% Difficult
-50% +100% Very Hard
-75% +300% Nearly Impossible
-90% +900% Account Blown

Why This Matters

You know the math. Are you actually staying within limits?

Trader's Second Brain tracks your real drawdowns across every trade and shows you the exact moment your risk management breaks down — before it's too late.

See your drawdown history

Frequently Asked Questions

What is drawdown in trading?
Drawdown is the peak-to-trough decline in your trading account. If your account goes from $10,000 to $8,000, that's a 20% drawdown. It measures the largest loss from a peak before a new peak is reached.
How much gain to recover from a 50% loss?
A 50% loss requires a 100% gain to recover. If you lose half ($10,000 → $5,000), you need to double your money to get back to $10,000. This asymmetry is why risk management is crucial.
What is a good maximum drawdown?
Most professional traders aim for maximum drawdown under 20%. Prop firms typically allow 5-10% daily and 10-12% overall. Anything above 30% becomes very difficult to recover from psychologically and mathematically.
How do you calculate drawdown?
Drawdown % = (Peak Value - Trough Value) / Peak Value × 100. If your account peaked at $12,000 then dropped to $9,000, drawdown = ($12,000 - $9,000) / $12,000 × 100 = 25%.
Why is drawdown important in trading?
Drawdown shows your worst-case scenario and tests your risk management. Large drawdowns are hard to recover from (50% loss needs 100% gain), damage confidence, and can lead to revenge trading. Keeping drawdowns small is key to longevity.

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Drawdown math is just the start

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