Recovery Calculator

Why Recovery Is Always Harder Than the Loss

When your account draws down, you need a larger percentage gain to get back to even — because percentage gains are calculated on a smaller base. A 25% loss on $10,000 leaves you with $7,500. To get back to $10,000, you need to grow $7,500 by $2,500 — a 33.33% gain.

This gap widens dramatically with deeper drawdowns. A 10% loss needs 11.1% recovery (1.11× gap). A 50% loss needs 100% recovery (2.0× gap). A 75% loss needs 300% recovery (4.0× gap).

The Recovery Gap at Different Drawdown Levels

Practical Implications

This is why risk management isn't optional — it's mathematical necessity. A trader who limits drawdown to 10% can recover with a modest 11% run. A trader who lets drawdown hit 50% must double their account just to break even. The difference between these two traders isn't strategy — it's discipline in cutting losses early.

Frequently Asked Questions

How do you calculate recovery from a drawdown?

Recovery% = Drawdown% / (100 - Drawdown%) × 100. A 25% drawdown requires 25/75 × 100 = 33.33% gain. The formula shows recovery is always larger than the drawdown because you grow from a smaller base.

How much gain to recover 50% loss?

A 50% drawdown requires a 100% gain to recover. If you lose $5,000 from a $10,000 account, your remaining $5,000 must double to get back to even.

What drawdown is unrecoverable?

Technically no drawdown is mathematically unrecoverable, but practically drawdowns above 50% become extremely difficult. A 75% drawdown needs a 300% gain — most traders close the account well before that point.

How many consecutive wins to recover?

It depends on your risk-reward. With 1:2 R:R and 2% risk per trade, recovering a 10% drawdown takes about 3 winning trades. A 25% drawdown takes approximately 7 wins. Use the compound calculator to model specific scenarios.