Paste a sequence of equity values (daily balances, monthly P&L curve) and get the maximum peak-to-trough decline — the number that defines how painful a strategy is to hold.
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Maximum drawdown (MDD) is the largest percentage fall from any equity peak to a subsequent trough. Two strategies with identical returns can have wildly different MDDs — and the one with the deeper drawdown is harder to trade in real life, because that's where discipline breaks and capital gets withdrawn at the worst moment.
Use closing equity values at a consistent interval (daily balances work well). Alongside return, MDD feeds ratios like Calmar (annual return ÷ MDD) that reward strategies for making money without deep holes.
Stop calculating trade-by-trade. TradeDiary imports your trades from Zerodha, Groww, Upstox, Dhan & more, and tracks these numbers across your whole history.
Start Free — No Credit Card →Context-dependent, but many systematic traders target MDD under 15–20% and treat anything beyond 30% as a strategy failure signal. Remember the recovery asymmetry: a 30% drawdown needs a 43% gain to repair.
Daily values catch intra-month spikes that monthly data smooths over, so daily MDD is always equal or worse — and more honest. Use the finest granularity you have; a journal that tracks daily P&L gives you this automatically.
It's a floor, not a ceiling — the standard assumption is that your worst future drawdown will exceed your worst historical one. Sizing decisions should leave room for that.