Drawdown Graph Inconsistency in Signal Provider Performance

[CODE STRUQT]

I am encountering a peculiar issue while attempting to review the performance details of certain Signal Providers, particularly concerning the drawdown graph. For instance, there is a Signal Provider who has been active for the last 46 weeks, consistently displaying commendable performance. However, upon inspecting the drawdown graph, I noticed a discrepancy.

Despite the Signal Provider's account specification indicating a maximum drawdown of 5.4%, the drawdown graph only displays information for 24 weeks and shows a minimal 0.34% drawdown. This inconsistency makes it challenging for me to cross-verify the actual maximum drawdown against the reported figure.

I am concerned about this discrepancy as the graph's information doesn't align with the mentioned drawdown percentage in the account specification. This lack of comprehensive drawdown data for the entire duration of the Signal Provider's performance impedes a complete evaluation of their risk management strategy.

Why the drawdown graph only presents data for 24 weeks, not reflecting the stated maximum drawdown of 5.4% as per the account specification?

[Sergey Golubev]

5.4% and 0.34% are different drawdown figures.
One is maximum drawdown and the ther one is live drawdown.

Forum on trading, automated trading systems and testing trading strategies

MY signal is showing a false drawdown level.

Eleni Anna Branou, 2022.03.18 17:38

Drawdown is not only the live drawdown of open trades, but also the account balance drawdown between high and low points.

You may never had more than a 3-4% live drawdown, but if you had 6-7 consecutive losses of 3%, that adds up to about 20% max drawdown.

From the article:

What the Numbers in the Expert Testing Report Mean

• Absolute drawdown is the difference between the initial deposit and the smalles value of balance within testing:

  AbsoluteDrawDown = InitialDeposit - MinimalBalance
  
  

• Maximal drawdown is the highest difference between one of local upper extremums of the balance graph and the following lower extremums:

  MaximalDrawDown = Max of (Maximal Peak - next Minimal Peak)
  
  The maximal drawdown percentage shows the ratio between the maximal drawdown and the value of respective local upper extremum:
  
  MaxDrawDown % = MaxDrawDown / its MaxPeak * 100%

[Eleni Anna Branou]

Also you should know that the Maximum Drawdown info is only valid since the signal has been published and connected to MQL5.com signals database and not since the beginning of the trading account.