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How do you calculate Drawdown?
Iepriekšējās 1 2 Nākamais
Staff

Biedrs kopš Jul 31, 2009  1368 ieraksti Ethan (Staff) Jun 11 2012 at 14:31

   zyrt posted:
   Thank you,
If my DD is 10%
Then I make a deposit / I get a bonus / I do good trades and my equity/balance grow. Will the DD go down? Thanks


No, the drawdown figure is the maximal drawdown experienced since account's inception. If you wish to 'reset' the drawdown, you should use custom start https://www.myfxbook.com/help#help_17

zyrt

Biedrs kopš Feb 15, 2012  202 ieraksti zyrt Jun 11 2012 at 14:33
Ok, thanks, I dont want to reset it, just to understand how it works.

lkwong

Biedrs kopš May 10, 2012  71 ieraksti LK Wong (lkwong) Jun 11 2012 at 15:28

   Staff posted:
   We log the maximal drawdown. Drawdown is calculated using several ways:
(1) logging of drawdown at each account update.
(2) calculation of balance drawdown
(3) calculation of equity drawdown based on historic prices (end of day)

The highest figure out of the above methods will be the one showing as the drawdown value, while drawdown chart shows end of day values.


Hi Ethan,

Thanks for your response. But what I'm looking at is quite frightening. On my main page, it says the system drawdown is 7.01%, but in the charts window, underdrawdown, it says that my most recent drawdown is 45.97%.

Do you think you could have a look at this for a moment for me ? Does the fact that my trading account is a mini account (10,000/lot) instead of a standard account (100,000/lot) make a difference ?

Thanks.

The YELLOW line should always be above the RED line. It means you've cut your losses, and let your winners run.
Staff

Biedrs kopš Jul 31, 2009  1368 ieraksti Ethan (Staff) Jun 12 2012 at 14:13

   lkwong posted:
   
   Staff posted:
   We log the maximal drawdown. Drawdown is calculated using several ways:
(1) logging of drawdown at each account update.
(2) calculation of balance drawdown
(3) calculation of equity drawdown based on historic prices (end of day)

The highest figure out of the above methods will be the one showing as the drawdown value, while drawdown chart shows end of day values.


Hi Ethan,

Thanks for your response. But what I'm looking at is quite frightening. On my main page, it says the system drawdown is 7.01%, but in the charts window, underdrawdown, it says that my most recent drawdown is 45.97%.

Do you think you could have a look at this for a moment for me ? Does the fact that my trading account is a mini account (10,000/lot) instead of a standard account (100,000/lot) make a difference ?

Thanks.


Fixed.

lkwong

Biedrs kopš May 10, 2012  71 ieraksti LK Wong (lkwong) Jun 12 2012 at 14:16
Wow! Thanks for the quick response, Ethan ! Much appreciated !

The YELLOW line should always be above the RED line. It means you've cut your losses, and let your winners run.
d4amenace

Biedrs kopš Oct 27, 2010  11 ieraksti d4amenace Sep 07 2012 at 00:16
Staff posted:

   zyrt posted:
   Thank you,
If my DD is 10%
Then I make a deposit / I get a bonus / I do good trades and my equity/balance grow. Will the DD go down? Thanks


No, the drawdown figure is the maximal drawdown experienced since account's inception. If you wish to 'reset' the drawdown, you should use custom start https://www.myfxbook.com/help#help_17


Just so I understand it better....The drawdown calculated in the maximal drawdown since inception in terms of open trade drawdown and not closed trade drawdown? right?

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