What are drawdowns and why are they important?
NGEN Markets Admin
Last Update 2 years ago
Drawdowns are extremely important to analyse.
Our drawdown analysis tab is unique and extremely insightful.
It shows the five worst drawdowns (or peak to trough losses) that the fund (or portfolio or stock) has suffered in the period in question.
We not only highlight the five worst drawdowns in the chart, but also show a table with each drawdown's start and end date along with the price. Most importantly, we also show how many working days it took to recover the loss.
Recovery is defined as the number of working days it took the price to finally make it back to the peak that it started falling from.
In the case that a particular loss has not yet been recovered, we also show the percentage of that loss that has so far been recovered.
This can give you a great idea of not only the kind of losses to expect in the future, but also how quickly recoveries can be expected.
