Drawdown
In short
Drawdown measures the decline from the account's last peak — the most honest risk metric, because it shows what you actually have to live through.
The math is mercilessly asymmetric: a 50% loss needs a 100% gain to recover. That is why our lab ranks strategies by drawdown first, returns second.
What is an "acceptable" drawdown?
Personal — but if you panic-sell at 30%, a 50%-drawdown strategy is not for you.
Related terms
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