Drawdown Calculator: Gain Needed to Break Even

Short answer

Recovery gain = drawdown ÷ (1 − drawdown). Down 20%? You need 25% to get back. Down 50%? You need 100%. Down 80%? You need 400%. The requirement accelerates because you are earning it on a smaller base.

Key takeaways

The recovery required grows faster than the loss, and the curve steepens sharply past 30%.
Maximum drawdown is the single most informative statistic about a strategy. More than win rate, more than total return.
Avoiding deep drawdowns is a position-sizing problem before it is a strategy problem.
Deep drawdowns also break the trader. Most accounts are abandoned, not liquidated.

Why the asymmetry exists

A 50% loss on $10,000 leaves $5,000. To get back to $10,000 you have to double the $5,000, a 100% gain. The percentage that took you down was calculated on the larger balance; the percentage that brings you back is calculated on the smaller one. That is the entire mechanism, and it is why the table below bends the way it does.

Drawdown	Gain required	In practice
5%	5.3%	A normal week
10%	11.1%	Recoverable, uncomfortable
20%	25%	Most funds' hard risk limit
30%	42.9%	Months of work to undo
50%	100%	You must double the account
75%	300%	Effectively a new account
90%	900%	Not realistically recoverable

Controlling drawdown

Drawdown is not something that happens to you; it is a consequence of choices that can be made in advance.

Fix risk per trade as a percentage. At 1% per trade, twenty consecutive losses cost 18% of the account. At 5% per trade the same run costs 64%. Run the numbers in the risk of ruin calculator.
Set a daily and weekly stop. A hard rule that closes the platform after three losses in a day converts an emotional spiral into a bounded loss.
Watch correlation. Long EUR/USD, long GBP/USD and short USD/CHF at 1% each is not 3% of risk in three trades, it is roughly 3% of risk in one dollar trade.
Cut size during a drawdown, not after it. Reducing risk while you are down slows the bleed and slows recovery. Most traders do the opposite, increasing size to get back faster, which is how a 20% drawdown becomes a 60% one.

The same calculators are inside the MarketPro app

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Written and reviewed by the MarketPro research desk

MarketPro is a trading-signal and trading-education app operated by Harajuku Holdings LTD (Cyprus). Our signal desk publishes and tracks every trade idea in-app, and every page here is checked against the app's live behaviour before publishing. Last reviewed 17 August 2026. How we produce signals and content · About MarketPro

FAQ

Drawdown recovery calculator: questions

What is an acceptable maximum drawdown?

Institutional mandates commonly cap it at 20%, and many prop-firm evaluations use 10% or less. For an individual, the practical test is different: the acceptable drawdown is the one you can sit through without changing your process. If a 15% drawdown makes you double your position size to catch up, then your real limit is below 15%.

What is the difference between absolute and relative drawdown?

Absolute drawdown measures the fall from your initial deposit. Relative (or maximum) drawdown measures the largest fall from any equity peak to the following trough, which is the more meaningful figure because it captures the worst stretch regardless of where it happened.

Does drawdown include open positions?

Equity drawdown does, which is the version that matters, because it reflects what would happen if everything closed right now. Balance drawdown counts only closed trades and can hide a large floating loss indefinitely. Judge a strategy on equity.

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Not investment advice. Past performance is not indicative of future results.