Correct drawdown calculation 討論

Mine and other brokers use small deposits/withdrawals of just a few cents or dollars to make up for little differences or to add VPS reimbursement etc. The problem is that it messes up the drawdown calculation (reported it as a bug, then I was told it's supposed to be like that though, which is weird). Would be great if the software ignored little deposits/withdrawals, say <$20, as those are just corrections - drawdown is one of the most critical attributes of a trading system.

Well, we can't just ignore deposits/withdrawals less than $20 since these might be valid deposits/withdrawals with those amounts which we must account for when calculating the drawdown.

Funds movement doesn't skew the drawdown calculation, but actually averages it out as the base balance on which the drawdown calcualtion is based of is always re-adjusting.

Not sure why, but my system shows 7.4% DD while the correct one is over 17%

Because fx book doesn't use NAV figures for draw down.

I tend to write mine down otherwise I'd have no clue.

LuckyBastard posted:
    Not sure why, but my system shows 7.4% DD while the correct one is over 17%

If that is based on equity, then we don't calculate equity yet, so drawdown is based on balance.