FoxScore

Metric guide

Max Drawdown (5y)

Worst peak-to-trough drop within the last ~5 years

Standalone ranking availableFoxScore methodology
Plain-language summary

What this metric tells you

Max Drawdown (5y) shows the deepest peak-to-trough loss within the selected 5-year window. It answers the question: how bad did the pain get at the worst point?

Key takeaway

Drawdown is about pain, not final outcome. A great long-term winner can still look brutal on this metric if the journey included one severe collapse.

FoxScore context

How FoxScore uses it

  • FoxScore uses this metric to test how harsh a full multi-year stretch became for holders.
  • It is useful when you care about the kind of damage that longer-term capital would have had to live through.
  • The 5-year window often catches both boom and stress phases that shorter windows miss.

How to interpret this metric

What it measures

  • The single worst decline from a local high to the following low within the window.
  • How much damage an investor would have had to sit through at the worst moment.
  • A harsher but more realistic view of risk than volatility alone.

How to read it

  • Values are usually negative because they measure losses from a peak.
  • Closer to 0 is better because it means the worst setback was milder.
  • Large negative values mean the asset suffered one very deep hole somewhere in the lookback period.

What can mislead

  • How often losses happened or how long the recovery took.
  • You treat one historical worst event as if it fully describes day-to-day risk.
  • You ignore recovery speed or present trend quality.

Most useful when

  • You care about downside pain more than headline return.
  • You want to eliminate assets whose past path would have been too hard to hold.
  • You want a reality check on strong performance numbers.

Important limits

  • How often losses happened or how long the recovery took.
  • Whether the asset later recovered strongly after the drawdown.
  • Whether the current setup is improving right now.
Methodology and sources

Technical definition, calculation notes and sources stay available here without dominating the explanation.

Description

Max drawdown (5y) shows the largest decline within roughly the last 5 years: from a local peak to the subsequent low.

Less negative means more stable.

Calculation

  • 1) H_t = max(Price_{t-5y..t})
  • 2) DD_t = (Price_t / H_t) − 1
  • 3) maxdd_5y = min(DD_t) within the 5y window

Interpretation

  • Less negative is better (closer to 0).

Metric ranking

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Related hubs

Continue into connected score and metric explanations.

  1. Scores

    Open related score explanations.

    Overall scorePerformanceStabilityTrend

  2. Metrics

    Open related metric explanations.

    Return 1 YearReturn (3y)Return (5y)Return (10y)Volatility (365d, annualized)Max Drawdown (365d)

Read together with

These related metrics add the context this metric cannot provide on its own.

Return (5y)

Read it with Return (5y) to compare the five-year payoff against the worst setback on the way.

CAGR/Drawdown Ratio

Use CAGR/Drawdown Ratio to combine long-run growth and worst drawdown in one number.

Trend Strength

Use Trend Strength to see whether the current trend quality looks cleaner than the old damage profile suggests.