Record peak equity and current equity separately
If peak equity was PHP 120,000 and current equity is PHP 90,000, the drawdown is:
(120,000 - 90,000) ÷ 120,000 = 25%
The gain required to return from PHP 90,000 to PHP 120,000 is 33.33%.
The worksheet should show both numbers because “down 25%” can psychologically sound smaller than “need 33.33% to recover.”
Recalculate risk from current equity
If the system studies 1% risk per trade, that means PHP 900 on current equity, not PHP 1,200 based on the former peak. Using the old risk amount would increase the percentage of the reduced account.
Add an anti-escalation rule
Write a rule such as “drawdown never authorizes higher risk by itself.” Any increase in risk must come from a separate evidence-based process, not from the desire to recover faster.
Completion check
Build three peak/current-equity pairs, calculate drawdown and required recovery, then compare a risk budget calculated from the old peak with one calculated from current equity. Explain which one silently increases account risk.
*Cryptocurrency and virtual asset transactions are highly volatile and irreversible, may result in significant losses, and do not guarantee returns; customers should trade only after understanding the risks involved.
