Relative Drawdown

The percentage between the difference of the maximum equity high and the subsequent equity low to the maximum equity high. For example, an initial deposit of $1000 records a floating profit of $500, whereas in the next trades it suffers a loss of $700. The maximum equity high will be equal to $1500 whereas the maximum equity low is equal to $800. The corresponding Relative Drawdown is calculated as (1500 - 800) / 1500 * 100 = 46.67%. After closing the trade with a balance of $800 a new order is placed which plunges to the opposite direction with a floating loss of $400. This time the Relative Drawdown is equal to 50%.

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