Calmar Ratio Calculator
Return per unit of maximum drawdown.
Calculate Calmar ratio — annualised return divided by maximum drawdown. Enter max drawdown and see the result instantly.
What this tool does
Enter annualised return and max drawdown. The tool shows Calmar ratio.
Enter Values
Formula Used
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Calculations, display, or translation — let us know.
Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
15% annualised return with 25% max drawdown: Calmar = 15/25 = 0.60. Above 1 excellent (return exceeds worst loss). Above 3 exceptional. Used heavily by hedge funds evaluating strategies — penalises strategies with large historical drawdowns.
A worked example
Try the defaults: annualised return of 15%, max drawdown of 25%. The tool returns 0.60. You can adjust any input and the result updates as you type — no submit button, no reload. That's the real power here: seeing how sensitive the output is to one or two assumptions.
What moves the number most
The result responds to Annualised Return and Max Drawdown. Not every input has equal weight. Flip one at a time toward extreme values to feel which ones move the needle most for your situation.
The formula behind this
Standard Calmar formula. Everything the calculator does is shown in the formula box below, so you can check the math against your own spreadsheet if you want.
Using this well
Treat the output as one point on a wider map. Run it three times — a pessimistic case, a central case, and a stretch case — and plan against the pessimistic one. That habit alone separates people who stick with an investment plan from those who bail at the first wobble.
What this doesn't capture
Steady-rate math ignores real-world volatility. Actual returns are lumpy; sequence-of-returns risk matters most in drawdown; fees and taxes drag on compound growth; and behaviour changes in drawdowns can reduce outcomes below the projection. Treat the number as one scenario, not a forecast.
What to calculate alongside this
One figure by itself is fragile. The sharpe ratio calculator, the maximum drawdown calculator, and the treynor ratio calculator cover adjacent ground — the answer to any one of them changes how you read the output from this tool. Worth a few minutes each, honestly.
Calmar ratio produces a risk-adjusted figure based on the inputs provided.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
Standard Calmar formula.
References
Frequently Asked Questions
Typical period?
Higher is better?
Versus Sharpe?
Limitations?
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