Drawdown Recovery Calculator
Calculate how much return you need to recover from a trading drawdown.
A drawdown recovery calculator shows why deep trading losses are dangerous: the deeper the drawdown, the disproportionately larger the percentage gain required just to get back to your previous account peak.
Why drawdown recovery is asymmetric
Losses and the gains needed to recover them are not symmetric. A 10% loss needs about 11.1% to recover, but a 50% loss needs a full 100% gain. This is the single most important reason to cap drawdown early.
| Drawdown | Gain needed to recover |
|---|---|
| 10% | 11.1% |
| 20% | 25% |
| 30% | 42.9% |
| 40% | 66.7% |
| 50% | 100% |
| 60% | 150% |
The formula, with a worked example
Required recovery % = drawdown% / (100 - drawdown%) x 100. For a 20% drawdown: 20 / 80 x 100 = 25%. So an account down 20% must gain 25% just to break even, which is why avoiding deep holes matters more than chasing them back.
What to do with this
Set a maximum drawdown you will not cross, size positions so a normal losing streak stays well inside it, and use your journal to catch the behavior (oversizing, revenge trading) that turns a small drawdown into a deep one.
Frequently asked questions
What is the drawdown recovery formula?
Required recovery percentage = drawdown percentage divided by (100 minus drawdown percentage), multiplied by 100. For example, a 20% drawdown requires 20 / 80 x 100 = 25% recovery.
Why does a 50% loss need a 100% gain?
Because the gain is calculated on the smaller remaining balance. If 100 falls to 50, you need to double the 50 (a 100% gain) to get back to 100.
Related pages
EdgeHabit is an educational and analytical tool for reviewing your own trading data. It is not investment advice, and it is not a broker, exchange, or SEBI-registered adviser. Trading involves a real risk of financial loss. Past performance does not guarantee future results.