Drawdown Recovery

定义

Drawdown recovery refers to the percentage gain needed to recover from a drawdown and return to the previous equity peak. Due to the asymmetric nature of percentage losses and gains, larger drawdowns require disproportionately larger recoveries: a 10% loss needs an 11.1% gain, a 25% loss needs 33.3%, and a 50% loss requires 100% to break even. This asymmetry underscores the importance of capital preservation.