Max Balance Drawdown

Created at 17 Mar 2021, 18:37

Joined 11.02.2021

Max Balance Drawdown
17 Mar 2021, 18:37

I would like to say it is not fair how the max balance drawdown is calculated

I start trading with my trading account with 10 euros. Starting balance is 10 eur. My first trade ever with the trading account. Then I make 1 euro profit.. In total I have 11 euros now.

But then I deposit 1000 euro because I decide to trade with more money. When I lose 11 euros, the maximum balance drawdown will be about minus 99% .

I hope you fix this. The starting balance is not important I think. cTrader should reset this every 24 hours and calculate the balance drawdown based on current balance not starting balance from a year ago..

Regards

@Wazzup

Replies

PanagiotisCharalampous
18 Mar 2021, 09:28

Hi Professional,

There is no fair and unfair way of calculating the balance drawdown. There is only one way and that is what we use. The balance drawdown is calculated using the current balance and comparing it with the highest balance the account has reached. The max balance drawdown is the maximum registered balance drawdown throughout the account history.

Best Regards,

Panagiotis

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@PanagiotisCharalampous

Wazzup
18 Mar 2021, 17:45 ( Updated at: 18 Mar 2021, 17:55 )

RE:

PanagiotisCharalampous said:

Hi Professional,

There is no fair and unfair way of calculating the balance drawdown. There is only one way and that is what we use. The balance drawdown is calculated using the current balance and comparing it with the highest balance the account has reached. The max balance drawdown is the maximum registered balance drawdown throughout the account history.

Best Regards,

Panagiotis

Join us on Telegram

I have noticed that if my starting balance is 10 eur and I never lose a trade for a month. Even If I make from 10 eur to 300 eur. Let's say I needed 1 month to do this and I had 200 trades opened and closed. Then after month If my first trade in the day I lose 10 eur . 300 eur minus 10 eur is 290 eur. The max balance drawdown will still be minus about 90% . It changes from no balance drawdown to about minus 90% . It is not based on current actual balance. This is what I have noticed.

( but if after a month, that I already made a 300 eur from 10 eur, I have some successful trades. Lets say I make 40 eur. Then I lose 30 eur. There is no drawdown. If this happens in the same day. But if I lose a trade, the calculation for the max balance drawdown is made based on the first starting balance. )

But I hope you are right, so I will actually test your claim