Drawdown is how far your account has fallen from its peak. The catch is that recovering it takes a bigger percentage gain than the loss — because you're building back from a smaller base. This calculator shows that gap, and it's a powerful argument for keeping losses small.
Drawdown recovery calculator
Gain needed to recover
Shows the gain needed to get back to break-even after a loss — it rises sharply as drawdowns deepen.
How it works
gain to recover = 1 ÷ (1 − drawdown%) − 1
After a loss, your next gains are calculated on the reduced balance, so you need a larger percentage to get back to where you started. Keep drawdowns shallow by sizing positions with the lot size calculator and using a stop on every trade.
Recovery at a glance
- 10% drawdown → needs +11.1%
- 20% drawdown → needs +25%
- 30% drawdown → needs +42.9%
- 50% drawdown → needs +100%
- 70% drawdown → needs +233.3%
The steep recovery curve is why experienced traders obsess over limiting losses rather than chasing gains. Risk management reduces the odds of a deep hole; it doesn't guarantee profit, and most retail traders lose money. This is a planning tool, not financial advice. Practise on a demo first.
Build the habit on a free demo
Open a free MT4 demo and practise small, controlled risk with virtual money — the surest way to keep drawdowns shallow.
⚠ Trading forex and CFDs is high-risk and most retail traders lose money. This is not financial advice.
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Related tools & guides
Use the lot size and compounding calculators, and learn how to set a stop loss in MT4.
Frequently asked questions
What is drawdown?
Drawdown is the drop from a peak in your account balance or equity to a later low, usually shown as a percentage. A fall from $10,000 to $8,000 is a 20% drawdown. It measures how much you've lost from your high-water mark.
How much gain do I need to recover a loss?
More than the loss itself, because the gain is earned on a smaller balance. The formula is gain = 1 ÷ (1 − drawdown) − 1. A 20% drawdown needs +25% to recover; a 50% drawdown needs +100%; a 70% drawdown needs over +230%.
Why does recovery get so much harder as drawdown deepens?
Because each loss shrinks the base your future gains are calculated on. Losing half your account leaves you needing to double what's left just to get back to even. That asymmetry is the main reason traders prioritise limiting losses.
How do I avoid big drawdowns?
Risk a small, fixed share of your account per trade (many use 1–2%), use a stop loss on every trade, and avoid over-leveraging. None of this guarantees profit, but it keeps a losing run from doing damage that's hard to recover from.
Trading foreign exchange and contracts for difference (CFDs) carries a high level of risk and may not be suitable for all investors. Leverage can work against you as well as for you. You could lose some or all of your deposited funds; do not trade with money you cannot afford to lose. Past performance is not indicative of future results. Nothing on MT4Download.com is financial, investment, or trading advice. Consider your circumstances and seek independent advice if needed.