Stock market glossary
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Drawdown (maximum decline)
Drawdown is a portfolio's fall from its highest point to the lowest point that follows: maximum drawdown tells you how much was lost at the worst moment.
Two portfolios can have the same final return but a very different path: one rises steadily, the other loses 40% before recovering. Maximum drawdown helps you understand how much risk was taken and whether you would really have held on without selling at the wrong moment.
💡 Fanta-Trade's overall leaderboard shows each portfolio's maximum drawdown next to its return.
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