Below please find a definition of “Draw Down”
You will often here to this a fund’s max draw down over 5 years or max draw down since inception. Some great low volatility funds will have max draw downs of only 3, 5, or 7% while others will have 10 or 20% draw down figures. Sometimes this is due to the nature of their strategy, other times it can show that they have slipped at least once in moving the portfolio out of harms way or building in certain stop losses or hedged positions. All of this depends on the strategy at hand.
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