Risk and position sizing
Drawdown Recovery Calculator: Gain Needed to Break Even
Enter a drawdown to see the percentage gain needed to get back to the peak and, with an average monthly return, how many months that takes. A second panel shows how deep a losing streak goes at your risk per trade.
Drawdown recovery calculator
- Gain needed to recover
- +33.33%
- to get back to the peak after a 25.0% drawdown
- Time to recover
- 15 months (about 1.2 years)
What a losing streak does to the account
10 losses in a row at 2.0% of the current balance leave the account down 18.29%, and it then needs +22.39% to recover.
| Drawdown | Gain needed |
|---|---|
| −5% | +5.3% |
| −10% | +11.1% |
| −20% | +25.0% |
| −25% | +33.3% |
| −30% | +42.9% |
| −40% | +66.7% |
| −50% | +100.0% |
| −60% | +150.0% |
| −75% | +300.0% |
| −90% | +900.0% |
Losses and gains compound: each percent lost needs more than a percent back. The time to recover assumes the same return every month, which real trading never delivers.
The calculator runs in your browser. Nothing you type is saved or sent anywhere.
Educational tool, not financial advice. The results only reflect the numbers you enter and say nothing about future returns. Trading involves a substantial risk of loss.
How to use the drawdown calculator
- Enter the drawdown: how far the account sits below its highest value, in percent.
- Read the gain needed to recover. It is always larger than the loss, and the gap widens fast past 20–30%.
- Add an average monthly return, if you want, to see roughly how many months the recovery takes at that pace.
- In the second panel, enter your risk per trade and a number of losses in a row to see how deep a normal losing streak takes the account.
- Use the result to set your risk per trade before the streak happens, with the position size calculator for each trade.
The drawdown formulas in plain words
A loss shrinks the base you recover from. After a 50% loss, $10,000 becomes $5,000, and getting back to $10,000 takes a 100% gain on what is left. In general, the gain needed is 1 divided by what remains, minus 1.
A losing streak compounds the same way. Risking a fixed share of the current balance means each loss is a little smaller in dollars, so 10 losses at 2% cost 18.29%, not 20%. The time to recover assumes a constant monthly return compounded each month, which is a planning number, not a forecast.
Gain needed = 1 ÷ (1 − drawdown) − 1
Months to recover = ln(1 ÷ (1 − drawdown)) ÷ ln(1 + monthly return)
Drawdown after n losses in a row = 1 − (1 − risk per trade)^n
Worked example
An account peaked at $20,000 and now stands at $15,000: a 25% drawdown.
- Gain needed: 1 ÷ 0.75 − 1 = 33.33%. $15,000 × 1.3333 = $20,000.
- At an average of 2% a month: ln(1 ÷ 0.75) ÷ ln(1.02) = 14.53, so about 15 months, a little over a year.
- A 50% drawdown would need a 100% gain, and a 75% drawdown a 300% gain.
- Losing streak: 10 losses in a row at 2% of the balance leave the account down 18.29%, which then needs a 22.39% gain. At 5% per trade, the same streak costs 40.13% and needs 67.02% to recover.
Questions
Why does a 50% loss need a 100% gain?
Because the gain is measured on a smaller balance. Half of $10,000 is $5,000, and $5,000 has to double to return to $10,000. The deeper the drawdown, the faster the required gain grows, which is why limiting losses matters more than finding big winners. The risk management lesson builds on this.
What is a normal drawdown for a trader?
There is no standard number, but losing streaks of 8 to 12 trades happen to sound strategies over a few hundred trades. Size each trade so that such a streak leaves a drawdown you can sit through without changing your plan, often between 10% and 20% of the account.
How is drawdown different from a loss?
A loss is one trade. A drawdown is the fall of the whole account from its highest value to its lowest point before a new high, across many trades. Maximum drawdown is the deepest of those falls over a period.
How can I reduce drawdowns?
Risk a smaller share of the account per trade, cap the risk you take on correlated positions at the same time, and stop trading for the day or week after a set loss. The risk of ruin calculator shows how risk per trade changes the odds of a deep drawdown.
UpTickFlow is our product. These guides are education, not financial advice. Trading involves a substantial risk of loss.