Investment profit and loss
Calculate a completed or hypothetical trade's net gain after entered costs. Enter the actual number of shares or asset units.
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Maximum drawdown in observed prices
Paste consistent prices oldest first to find the largest earlier-peak-to-later-trough fall in your observations. Keep historical loss separate from future risk limits.
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Maximum observed drawdown (loss magnitude)
25%
The main answer is the largest earlier-peak-to-later-trough fall within your observations, shown as a positive magnitude. Zero means no fall was observed in these points, not no risk. The gain needed to reach the old peak is arithmetic, not a promise of recovery.
Peak value for this drawdown120
Trough value for this drawdown90
Peak observation (oldest first)4 records
Trough observation (oldest first)5 records
Gain needed from that trough to the old peak33.333333 %
Number of observations entered6 records
Worked steps
- (120 − 90) ÷ 120 × 100 = 25%
For each observation, compare its value with the highest value already observed. Percentage fall equals (earlier peak minus current value) / earlier peak × 100. Keep the largest fall. The percentage gain from a positive trough back to that peak equals (peak minus trough) / trough × 100. Only the supplied period and sampling frequency are covered; weekly observations can miss an intraweek low. No dividend, split, currency or external cash-flow adjustment is performed. A later zero is a full 100% loss and has no finite percentage gain back to a positive peak. Tiny positive falls show <0.000001%; a non-total fall near 100% shows >99.999999%. Save the asset, period and data basis in the plan name. Past drawdown is not a future loss limit or a reason to add leverage.
Method and scope
The main answer is the largest earlier-peak-to-later-trough fall within your observations, shown as a positive magnitude. Zero means no fall was observed in these points, not no risk. The gain needed to reach the old peak is arithmetic, not a promise of recovery.
Only the supplied period and sampling frequency are covered; weekly observations can miss an intraweek low. No dividend, split, currency or external cash-flow adjustment is performed. A later zero is a full 100% loss and has no finite percentage gain back to a positive peak. Tiny positive falls show <0.000001%; a non-total fall near 100% shows >99.999999%. Save the asset, period and data basis in the plan name. Past drawdown is not a future loss limit or a reason to add leverage.
References:MSCI IndexMetrics: maximum drawdown definition and formula (page 51)
What this tool helps you do
Find the largest observed percentage fall from an earlier peak to a later trough. Endpoint profit and annualized return describe different questions, while standard deviation ignores order. A high occurring after a low cannot be paired with that earlier low.
What to enter
Enter 2–250 observations, oldest first, from 0 to one billion with at most four decimal places. The first must exceed zero. Later zero means a genuine zero value. Use the same asset, currency and split/dividend basis. Do not paste dates, returns or unadjusted account balances with deposits or withdrawals. Write 1000 without a thousands comma.
How it is calculated
For each observation, compare its value with the highest value already observed. Percentage fall equals (earlier peak minus current value) / earlier peak × 100. Keep the largest fall. The percentage gain from a positive trough back to that peak equals (peak minus trough) / trough × 100.
Worked example
Synthetic example: 100, 110, 99, 120, 90, 108 gives a 25% maximum observed fall from observation 4 at 120 to observation 5 at 90. Returning from 90 to 120 would require a gain of approximately 33.333333%, not 25%. This does not predict that recovery will happen.
Understanding the answer
The result is a positive loss magnitude, not a profit; some reports use a negative sign for the same fall. Peak and trough positions are numbered oldest first. With no observed fall there is no episode to identify. Tied maximum falls use the earliest trough and earliest identical peak. No dates or duration are inferred.
Scope and limitations
Only the supplied period and sampling frequency are covered; weekly observations can miss an intraweek low. No dividend, split, currency or external cash-flow adjustment is performed. A later zero is a full 100% loss and has no finite percentage gain back to a positive peak. Tiny positive falls show <0.000001%; a non-total fall near 100% shows >99.999999%. Save the asset, period and data basis in the plan name. Past drawdown is not a future loss limit or a reason to add leverage.