On this page is a Stock Drawdown Calculator. This tool helps you understand the past value declines of a stock investment by calculating the maximum drawdown and finding drawdown periods within a selected timeframe. You can either graph the output or display a drawdown period table. Contains data for thousands of American Stocks and ADRs, updated within the previous seven days.
Using the Stock Drawdown Calculator
To effectively use this tool to analyze past drawdowns in a stock investment, follow these steps:
- Ticker: Enter the ticker for an American Stock or ADR. The list of tickers will auto-filter and complete as you type.
- Log scale: If checked, the tool will graph the stock price using a log scale.
- Starting Date: Enter the date you want to start analyzing drawdowns.
- Ending Date: Enter the date you want to end analyze drawdowns.
- Calculate: Click the Calculate button to view the maximum drawdown in that period along with a chart between the dates. The tool will draw a graph of the stock's price in that time along with an overlaid area graph showing drawdowns from the previous closing peak.
- Show Drawdowns: Click the Show Drawdowns button to display a detailed table of all significant drawdown periods.
The table will include the stock's peak and trough closing value and date, the percentage drawdown between the two, the duration of the drawdown period, and the volatility in that period. It only shows drawdowns of 30 or more days.
Understanding drawdowns
Understanding drawdowns is important. They measure the drop from peak to bottom (alternatively, peak to trough) in the value of a portfolio, thus providing insights into the potential risk and volatility of stock investments.
Of course, historical performance is not a guarantee of future performance, but it can be instructive. If a stock has fallen quite a bit in its past – even if it has recovered by today – the tool will show you visually how tough those drawdown periods would have been.
Special Features
Our Stock Drawdown Calculator offers a few unique features:
- Maximum Drawdown: Calculates the largest percentage drop in investment value over the specified period. You'll see this if you hit the Calculate button (which also shows the graph).
- Drawdown Periods: Identifies specific periods where significant drawdowns occurred (which I've defined as 30 or more calendar days from a peak) and puts stats on them in a table, helping you understand the duration and severity of investment declines.
This is a feature of the Show Drawdowns button. - Volatility: Computes the annualized volatility during a drawdown based on daily log returns during the drawdown periods in the table.
- Interactive Graphs: Visualize drawdown dynamics with interactive charts that highlight drawdowns from the previous high at a date, along with the stoc's price through that period..
Methodology and Data Sources
The calculator uses historical price data for stocks from Tiingo.
Any forward or reverse splits are accounted for in the stock price. Dividend reinvestment is not included (use the Stock Total Return tool for dividend reinvestment). Also, try the Stock Daily Moving Average tool.
Disclaimer
While we strive to provide accurate and up-to-date information, the results from this calculator are for informational purposes only and should not be considered financial advice. Past performance is not a guarantee of future returns. Always conduct your own research and consult with a financial advisor before making investment decisions.
We hope this tool aids you in learning more about how a stock investment may have performed in the past. For more financial tools, check out our Investing category page.
