Risk Systems — Drawdown Control
Edge without survival is worthless.
Layer 01 — The pipeline
From Equity Peak High to permission.
Drawdown is measured from the highest realized equity — the Equity Peak High anchor. The DD pipeline feeds the Gate Map, which assigns capital state; the gate assigns brake tone and tier cap; the throttle converts that into deployment authority. Hidden capital pressure cannot be ignored because the pipeline makes it structural.
Layer 02 — Against the benchmark
Is this drawdown normal, or is it a warning?
The Monte Carlo Benchmark produces expected drawdown bands. Live drawdown better than the bands suggests strong capital control; inside the bands is expected behavior; worse than the adverse percentile bands means the system may be over-risked, poorly executed, or structurally weaker than modeled. A live account can be above median equity and still structurally unhealthy if max drawdown is worse than the adverse bands.
How MARS uses this
The benchmark records the worst drawdown of every simulated path and bins them against the gate ladder. MARS reads live drawdown against these bands and against gate state together: inside the bands is expected pain; beyond the adverse bands is a structural warning that outranks any green dashboard.
How it benefits you
You get a pre-agreed definition of normal pain, decided calmly before the pain started. That single artifact prevents the two classic errors - panic de-risking inside ordinary variance, and denial when damage is genuinely abnormal. You always know which situation you are in.
Distribution of maximum drawdowns across simulated paths, overlaid on the gate zones - from Growth on the left to System Lock territory in the deep-red tail.
Reference
Gate and drawdown authority — the capital-state map
| Gate | Drawdown range | Brake meaning | Max tier cap |
|---|---|---|---|
| Growth | Better than −7% | Expansion / full compounding | T7 possible |
| Recovery | −7.1% to −13% | Stability brake | T5 max |
| Buffer | −13.1% to −19% | Defense brake | T3/T4 max |
| Floor | −19.1% to −27% | Containment brake | T2/T3 max |
| Deep-Floor | −27.1% to −34% | Suppression brake | T1/T2 max |
| Ground-Floor | −34.1% to −40% | Seizure brake | T1 only |
| System Lock | Worse than −40% | Stasis — no trading | No trading |
The governing idea
Use cases
Where it earns its place
- ▸Objective answers to “should I be trading full size right now?”
- ▸Protecting accumulated gains, not just starting capital
- ▸Separating normal variance drawdown from structural deterioration via percentile bands
- ▸Automatic de-risking through gate transitions instead of after-the-fact regret
Inside this module
2 pages go deeper than this one.
Connected inside MARS
This module doesn't work alone.
Go deeper
Operator briefs on this territory.
Deep dive — 01
The gate ladder: authority that shrinks before pain does.
How gate states compress authority as drawdown deepens — mechanically, before the damage compounds.
Read the full brief →
Deep dive — 02
Anatomy of the drawdown ladder: seven bands, one purpose.
−7, −13, −19, −27, −34, −40: reading the band boundaries as a survivability schedule.
Read the full brief →
Deep dive — 03
Climbing out vs. digging in: how the system behaves in Recovery versus Floor.
At −10% the mission is stability. At −23% the mission is stopping the descent. Two opposite postures, one system.
Read the full brief →
Every module ships in the complete MARS package.
One price. Eleven workbooks, three TradingView indicators, and the full manual library — $497.