Drawdown Recovery Calculator
See the gain required to recover from a loss and estimate recovery periods.
Drawdown Recovery Calculator calculation coverage
- 01
Asymmetric recovery math
- 02
Capital remaining
- 03
Period estimate
A constant periodic return is hypothetical and does not describe real market paths.
About this tool
A drawdown recovery calculator shows the gain needed to return reduced capital to its starting value. Because the recovery begins from a smaller base, the required percentage gain is larger than the original percentage loss.
How it works
Capital remaining = starting capital × (1 − drawdown). Required recovery gain = starting capital ÷ remaining capital − 1. Period estimates compound the assumed return.
| Parameter | How it is used |
|---|---|
| Reference peak | The prior peak used to measure your input drawdown; no currency balance is needed. |
| Drawdown | Percentage loss from the starting value. |
| Periodic return | Hypothetical recovery rate per period. |
| Capital remaining | Amount available to compound during recovery. |
Recovering from a 20% loss
A 20% drawdown and a hypothetical constant 5% gain per recovery period, with no deposits or withdrawals.
Required gain = 1 ÷ (1 − 0.20) − 1 = 25%. Four periods return 21.55%; five return 27.63%.
A 25% gain is needed. Under the constant-return assumption, recovery takes five whole periods.
The period count is a scenario, not a timetable. Further losses or cash flows change the path.
How to use this tool
- Enter the measured peak-to-trough drawdown percentage.
- Add a hypothetical return per recovery period.
- Review the required gain and period estimate, then stress-test slower returns.
Frequently asked questions
Why does a 50 percent loss require a 100 percent gain?
After a 50 percent loss, only half the capital remains. Doubling that smaller amount requires a 100 percent gain to reach the original value.
What is maximum drawdown?
Maximum drawdown is the largest peak-to-trough percentage decline observed over a selected period.
Is the recovery-period estimate a forecast?
No. It assumes the same return every period, while real returns vary and can include further losses.