RISK MANAGEMENT CALCULATOR
Drawdown Calculator
Calculate your exact peak-to-trough account drawdown percentage, monetary loss, and the compounding percentage gain required to recover back to your starting equity.
Drawdown Presets:
Account Balances
$
$
Current Capital Left80.0%
Used to estimate how many months you will need to recover using realistic risk.
⚠️ Prop Firm 10% Max Drawdown Breached
Your account is down 20.0%. Most funded evaluations disqualify accounts at 8-10% total max loss.
Drawdown & Recovery Analysis
Mathematical summary of capital loss and required return
Current Drawdown
-20.00%
-$2,000.00Required Gain to Breakeven
+25.00%
to reach $10,000Est. Recovery Time
5 mo
at 5% return/moCapital Preserved80.0%
The Non-Linear Math of Trading Drawdowns
Why small losses are manageable, but deep losses permanently cripple accounts:
| Loss % | Remaining Capital | Gain % Needed to Recover | Risk Level |
|---|---|---|---|
| -5% | 95% | +5.26% | Low |
| -10% | 90% | +11.11% | Moderate |
| -15% | 85% | +17.65% | Caution |
| -20% | 80% | +25.00% | Severe |
| -30% | 70% | +42.86% | Critical |
| -40% | 60% | +66.67% | Dangerous |
| -50% | 50% | +100.00% | Extreme |
| -60% | 40% | +150.00% | Catastrophic |
| -75% | 25% | +300.00% | Near Total |
| -90% | 10% | +900.00% | Terminal |
RECOMMENDED CALCULATOR
Use Position Size Tool →Position Size Calculator
Fix your risk at 1% per trade to mathematically prevent catastrophic drawdowns before they happen.
LESSON GUIDE
Read Risk Lesson →Managing Drawdowns & Tilt Spirals
Learn the psychological and operational protocols professional funds implement during losing streaks.
Frequently Asked Questions
Because losses reduce the principal capital available to generate future returns. For example, if a $10,000 account loses 50% ($5,000), the remaining balance is $5,000. To reach $10,000 again from $5,000, you must make $5,000 on a $5,000 base — which is a 100% gain! The formula is: Required Gain % = [Loss % / (100 - Loss %)] × 100.
Peak-to-Trough drawdown measures any decline from a specific historical account peak to its subsequent low point. Maximum Drawdown (MDD) is the single deepest peak-to-trough decline experienced across the entire trading track record. It is the primary metric hedge funds and prop firms use to measure downside risk.
Most proprietary trading firms (e.g. FTMO, FundingPips) enforce a 5% maximum daily loss and a 10% maximum overall trailing/static drawdown. Breaching either limit immediately disqualifies the account. Use this calculator to know your exact remaining dollar buffer before entering new positions.
Strict position sizing is the single most effective defense. By risking only 1% of total account capital per trade, you would need 20 consecutive losing trades just to experience an 18% drawdown. Compounding risk math ensures smaller position sizes as your balance decreases.