Depth is chosen, not suffered
Drawdown is a consequence of size. The trader who never exceeds 10% mostly decided that in advance rather than being lucky.
Size is the inputFree tool
Losing 50% needs 100% to get back.
Drawdown is the only trading number that is asymmetric against you, and the asymmetry gets worse the deeper you go. It is why position sizing decides more outcomes than entries do, and the arithmetic is worth seeing rather than being told.
Drawdown recovery calculator
Peak is the highest your account reached; low is the lowest point after it. Average profit per trade is optional — it turns the recovery figure into a number of trades, which is usually more sobering than the percentage.
Return needed to recover —
Drawdown —
Amount to make back —
Balance remaining —
At your average, that is —
Why the two numbers are not the same
Because they are measured against different balances. Losing 20% of $50,000 is $10,000, leaving $40,000. Making that $10,000 back is a 25% gain — because it is 25% of $40,000, not of the original.
The gap widens fast. At 10% down you need 11.1%. At 30% you need 42.9%. At 50% you need 100%. At 70% you need 233%, which is not a recovery plan, it is a different career.
This is the entire argument for small position sizes, and it is arithmetic rather than temperament. A trader who never exceeds 10% drawdown needs an ordinary run to recover. A trader who reaches 50% needs to double an account they have just proven they can halve.
| Drawdown | Gain needed to recover |
|---|---|
| 5% | 5.3% |
| 10% | 11.1% |
| 20% | 25.0% |
| 30% | 42.9% |
| 40% | 66.7% |
| 50% | 100.0% |
| 60% | 150.0% |
| 70% | 233.3% |
| 80% | 400.0% |
The arithmetic
One line, and it is worth being able to do in your head:
drawdown = (peak − low) ÷ peak
recovery needed = (1 ÷ (1 − drawdown)) − 1The useful mental shortcut: divide 100 by (100 minus your drawdown percentage), subtract 1. Down 20%? 100 ÷ 80 = 1.25, so 25%.
What the number cannot tell you
It measures depth, and depth is only half of what makes a drawdown dangerous.
Duration is missing. A 20% drawdown recovered in three weeks and a 20% drawdown that has lasted eight months are the same number and completely different experiences. The second one is where people abandon strategies that were working.
Cause is missing. A drawdown from normal variance and one from a strategy that has stopped working look identical while you are in them. That is the genuinely hard problem, and no calculator solves it — only a long enough record does.
Your limits are missing. On a funded account the constraint is not the percentage, it is the firm's floor. A 20% drawdown is academic if the trailing limit ended the account at 4% — see trailing drawdown explained.
Sizing so the number stays small
Drawdown is an output of position size, and position size is the input you control completely.
Work backwards: decide the deepest drawdown you would tolerate without abandoning the strategy — be honest, not aspirational — then decide how many consecutive losses that has to cover. Four in a row is not pessimistic for any strategy winning less than 70% of the time. Divide, and that is your risk per trade.
A 20% tolerance across four losses is 5% a trade, which is far more than most people should run. The same arithmetic with ten consecutive losses gives 2%, which is closer to reasonable.
The position size calculator turns that percentage into a contract count for a specific stop. The expectancy calculator tells you whether the strategy justifies risking anything at all.
Count losses, not probability
Plan for consecutive losses rather than expected ones. Streaks are ordinary, and the account has to survive them.
Four is a floorFunded accounts are stricter
A prop firm's floor arrives long before a percentage that would worry you on your own account, and a trailing one moves.
The floor is the limitCommon questions
How do you calculate drawdown?
Subtract the lowest balance from the highest balance reached before it, then divide by that peak. A $50,000 account that fell to $35,000 has a 30% drawdown.
How much do I need to make back a 50% loss?
100%. You have to double what remains, because the gain is measured against the smaller balance. That asymmetry is the whole reason position sizing matters more than entry timing.
What is the formula for drawdown recovery?
(1 ÷ (1 − drawdown)) − 1. Down 20% means 1 ÷ 0.8 = 1.25, so a 25% gain. The mental shortcut is 100 divided by (100 minus your drawdown percentage).
What is an acceptable drawdown?
The one you will actually sit through without abandoning the strategy, which is usually smaller than people claim in advance. Most professional risk frameworks treat 20% as significant and 30%+ as a reason to stop and re-examine rather than trade through.
Is maximum drawdown the same as a prop firm drawdown limit?
No. Maximum drawdown describes what happened to your equity. A prop firm's drawdown limit is a hard floor that closes the account, and it is often trailing — it rises behind your profits, so it can arrive far earlier than any percentage you would have worried about.
Is my data sent anywhere?
No. The calculator runs entirely in your browser. Nothing you type is transmitted, stored or logged, and the page makes no network request while you use it.
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Connect a sim or evaluation account and run the whole product against it before you point anything at live money. Nothing about the setup changes when you do.