What maximum drawdown tells you
Averages hide pain. Maximum drawdown captures the single worst slide from a high point to a subsequent low — the deepest paper loss you'd have endured had you bought at the worst possible peak.
A fund with a strong CAGR but a -55% max drawdown demanded enormous patience to hold through. A fund at -25% was a calmer ride.
How to read it
- Compare within the same category; equity drawdowns dwarf debt drawdowns.
- Ask yourself honestly: would you have stayed invested through that fall, or sold near the bottom?
- Drawdown pairs with the Calmar ratio (return divided by max drawdown) to judge reward per unit of worst-case pain.
How FindMF computes it
We build a daily wealth index from the fund's AMFI NAV series, track the running peak, and record the largest percentage drop from any peak to its following trough. It's shown as a negative percentage. Note: on funds flagged for splits or corporate actions, drawdown can be distorted because we flag but do not back-adjust the NAV. See methodology.