Calculate the percentage gain required to return to a prior balance after a drawdown.
How this is calculated
Required gain (%) = (drawdown % ÷ (100 − drawdown %)) × 100
Balance after drawdown = starting balance × (1 − drawdown % ÷ 100)
Trades to recover = ln(1 ÷ (1 − drawdown % ÷ 100)) ÷ ln(1 + average return % ÷ 100), rounded up
Worked example
A 50% drawdown leaves half the prior balance.
Required gain = (50 ÷ 50) × 100 = 100.0%.
At an average 2% return per trade: ln(2) ÷ ln(1.02) = 35.0, so 35 trades are required.
By comparison a 20% drawdown needs a 25.0% gain, or 12 trades at the same rate.
Understanding drawdown recovery
Recovery is asymmetric because the gain is measured against a smaller balance than the loss was. Losing 20% and then gaining 20% does not return the account to its starting value — the 20% gain applies to 80 cents on the dollar, leaving 96%. The required gain is always larger than the drawdown, and the gap widens as the drawdown deepens.
The asymmetry grows non-linearly, and that is the whole point of the reference table on this page. A 10% drawdown needs 11.1%. A 30% drawdown needs 42.9%. A 50% drawdown needs 100%. By 80% the requirement is 400%, which is why deep drawdowns are treated as close to terminal by most risk frameworks: the recovery is no longer the same kind of task the account was performing before the decline. Nothing about the strategy has to have changed for the arithmetic to become punitive.
The trades-to-recover figure translates the percentage into a duration estimate using a constant average return per trade. It is deliberately simple: it assumes every trade returns the same percentage and that no further drawdown occurs during the recovery. Real recoveries are interrupted, so treat the count as a floor rather than a forecast. It is most useful as a comparison — seeing that a 50% hole takes three times as many trades as a 20% one communicates more than either number alone.
Two effects make real recoveries slower than the arithmetic suggests. Position sizing that scales with the balance shrinks after a loss, so the dollar value of each subsequent win is smaller even when the percentage return is identical, and fixed costs such as commissions consume a larger share of a reduced account. Psychological effects compound this: the pressure to make the money back quickly is precisely the condition under which risk per trade tends to rise, which raises the probability of a deeper hole rather than a faster exit from the current one.
The practical use of this calculation is preventative rather than remedial. Knowing what a 30% drawdown will demand is an argument for risk limits that make a 30% drawdown improbable in the first place. This page compares two balances and models nothing else — deposits, withdrawals, changes in strategy and changes in market regime are all outside it.
Frequently asked questions
Why does a 50% loss need a 100% gain?
The gain is measured against the reduced balance. Doubling $50,000 is required to return to $100,000.
Does this include deposits or withdrawals?
No. It compares two balances only; cash flows into or out of the account are not modelled.
How long does recovery take?
That depends on returns per period, which this calculator does not model. The compounding calculator projects balance paths over time.
Is percentage drawdown measured from peak equity?
Conventionally yes — from the highest balance or equity reached before the decline.