drawdown took place doesn’t have to remain the same, but can change with the fic-
tive f. In Figure 27.2, I also calculate the average drawdown, which can function as
an input to the drawdown freak-occurrence calculation we learned about in Part 1.
Remember, the drawdown is not a core system characteristic, but a function of other
system characteristics, and a large drawdown isn’t necessarily a bad thing.
There is no saying how the maximum flat time will change with changes in
the fictive f. Sometimes a large fcreates deep drawdowns that take a long time and
many trades to get out of; at other times a large fincreases the value of the win-
ning trades leading out of a drawdown, thus shortening the time it takes to get out.
As with the drawdown, the time covering the longest flat time also can change
with the f.314 PART 4 Money Management
FIGURE 26.7
A running total portfolio summary.