Drawdown (economics)

The maximum drawdown is a measure commonly used in the financial world, for example. It represents the maximum cumulative loss is within a respective period and is represented generally as a percentage.

Formula

Example

A fund amounting to a low of the period under consideration 95 EUR. The highest price was reached before at 102 EUR. The result is ( in simplified form ):

(95 * 100/102 ) = -100 -6.86 %

  • Financial Analysis
  • Economic indicator
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