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  #1 (permalink)  
Old 07-22-2007, 03:36 AM
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koolit is on a distinguished road
Drawdown

Hello,

I am new to Forex trading. I am using an EA on demo account which has the following drawdown numbers from back testing. In simple terms, what do those numbers mean?

Absolute drawdown 3173.10
Maximal drawdown 6526.50 (74.49%)
Relative drawdown 74.49% (6526.50)

Thanks.
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Old 07-22-2007, 07:49 AM
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no entirely sure myself but i believe

Absolute drawdown - the drawdown past your original starting point (if your account grew from £10,000 to £20,000 but then lost £15,000 you absolute drawdown would be £5,0000)

Maximal drawdown - the maximum loss sustained by the account (if your account grew from £10,000 to £20,000 but then lost £15,000 you maximal drawdown would be £15,0000)

Relative drawdown - same as above but shown as percent of the account
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Old 07-22-2007, 03:28 PM
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Thanks, trevman. That helps.

I am trying to understand that if I start with 10,000, then how much money I can invest with this EA without getting a margin call. This EA has stop loss of 210. Looks like I can invest 2000-2500 out of 10,000 and would never get a margin call. Correct?
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Old 07-22-2007, 06:11 PM
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its not how much you have in your account, but how big you trade relative to whats in your account but if your absolute drawdown is £3,000 then your probably going to be ok with £5,000
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Old 07-23-2007, 09:00 PM
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trevman is on a distinguished road
to confirm what i said before

Quote:
Originally Posted by MetaTrader4

Absolute drawdown — the largest loss is below initial deposit value;

Maximal drawdown — the largest loss of the local maximum in the deposit currency and in per cents of the deposit;
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Old 07-24-2007, 03:03 AM
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Thanks, trevman. I understand it completely now.
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Old 07-24-2007, 07:45 AM
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raden mas is on a distinguished road
about draw down

draw down is cummulative your several loss in trade. and draw down max is newest (highest) cummulative of your several losses in your trade.
relaive draw down is your average of draw down.
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Old 07-24-2007, 07:46 AM
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about draw down

draw down is cummulative your several loss in trade. and draw down max is newest (highest) cummulative of your several losses in your trade.
relaive draw down is your average of draw down.

draw down be used for look for the max draw down and max draw down is used for count how much money will be need to start trade with effectively follow certainly trade system or your trade style.
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Old 07-29-2007, 08:20 PM
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with a 74.49% draw down, I would hope you are not planning on using that system.
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Old 09-19-2008, 06:09 PM
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drawdown ea

Hi,

Does anyone know of an EA that will record and display the maximum drawdown on my account balance for the day.
I am unable to monitor my PC and need to know the max drawdown that has occured whilst I have been away. Thanks.

It should display the results like this:

Maximum Drawdown for 19th Sept 22%
Maximum Drawdown on account balance - $ 1280
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