Drawdown

---
name: "drawdown"
version: "1.0.0"
description: "Drawdown analysis reference — maximum drawdown, peak-to-trough, recovery time, risk metrics. Use when evaluating portfolio risk, stress-testing strategies, or measuring downside exposure."
author: "BytesAgain"
homepage: "https://bytesagain.com"
source: "https://github.com/bytesagain/ai-skills"
tags: [drawdown, risk, portfolio, maximum-drawdown, recovery, finance, volatility]
category: "finance"
---

# Drawdown — Drawdown Analysis & Risk Measurement Reference

Quick-reference skill for understanding, calculating, and applying drawdown metrics in portfolio management and risk analysis.

## When to Use

- Measuring maximum drawdown of a portfolio or strategy
- Comparing risk profiles of different investments
- Setting stop-loss levels based on historical drawdowns
- Stress-testing strategies against worst-case scenarios
- Evaluating fund manager performance through drawdown lens

## Commands

### `intro`

```bash
scripts/script.sh intro
```

Overview of drawdown — definition, significance, and types.

### `calculate`

```bash
scripts/script.sh calculate
```

How to calculate drawdown — formulas, step-by-step, and time series methods.

### `metrics`

```bash
scripts/script.sh metrics
```

Key drawdown metrics — MDD, Calmar ratio, Ulcer Index, pain index.

### `historical`

```bash
scripts/script.sh historical
```

Major historical drawdowns — market crashes, recovery timelines.

### `management`

```bash
scripts/script.sh management
```

Drawdown management — position sizing, stop-losses, risk budgeting.

### `recovery`

```bash
scripts/script.sh recovery
```

Recovery analysis — math of recovery, time to recover, asymmetry of losses.

### `comparison`

```bash
scripts/script.sh comparison
```

Drawdown vs other risk measures — volatility, VaR, CVaR, Sortino.

### `examples`

```bash
scripts/script.sh examples
```

Worked examples with calculations and strategy evaluation.

### `help`

```bash
scripts/script.sh help
```

### `version`

```bash
scripts/script.sh version
```

## Configuration

| Variable | Description |
|----------|-------------|
| `DRAWDOWN_DIR` | Data directory (default: ~/.drawdown/) |

---

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