How it works
The asymmetry of losses
If you lose a percentage d of your account, you need to gain d ÷ (1 − d) to get back to where you started. At 10% that is 11.1%; at 30%, 42.9%; at 50%, 100%.
That is why limiting risk per trade is so important. Risking a fixed 1% of the current balance, 10 losses in a row take you to a drawdown of about 9.6%; risking 5%, the same 10 losses would mean roughly 40%.
FormulaRecovery = 1 ÷ (1 − Drawdown) − 1