MT5 recovery factor: what the number really tells you

The recovery factor compares your profit with your worst dip. Here is how MT5 reports it, how to read it and when to distrust it.

Open a trade report in MetaTrader 5 and, near the top, you will find a block of numbers: net profit, profit factor, expected payoff, recovery factor and sometimes a Sharpe ratio. Most traders look at net profit and nothing else. The recovery factor is worth a second look, because it answers a question net profit cannot: how much pain did you go through to earn that money? This page explains what the recovery factor is, how it is worked out, how to read it, and where it misleads.

What the recovery factor measures

The recovery factor is a ratio. In plain words, it is your total net profit divided by your largest drawdown. If you made 1,200 and the deepest dip from a peak to a trough was 400, the recovery factor is 3.0. The account earned three times what it cost to survive its worst stretch.

Think of it as a measure of efficiency. Two traders can end a quarter with the same profit, but one got there on a smooth line and the other rode a rollercoaster that nearly ended the account. Net profit makes them look identical. The recovery factor separates them.

Where to find it in MT5

MetaTrader 5 prints the recovery factor in the strategy tester report and in the trade report you can create from the History tab. In the terminal, open the Toolbox, switch to the History tab, set the period, right-click and look for the report options. Menu wording changes between builds and brokers, so check what your own terminal offers. The report lists the figure beside profit factor and expected payoff; a deeper explanation of each report section is on the MT5 report analyzer page.

Be careful about which drawdown the report uses. A report can list a balance drawdown (based on closed trades) and an equity drawdown (based on floating profit too). The two can differ a lot if you hold losing trades open for a long time. Read the line labels in your own report instead of assuming, and when you compare two reports make sure both use the same one. The difference between these two ideas is covered in MT5 balance vs equity explained.

A worked example (hypothetical)

Take two accounts with made-up numbers. Both ended the month with a net profit of 1,200.

	Account A	Account B
Net profit	1,200	1,200
Largest drawdown	400	1,200
Recovery factor	3.0	1.0
What it suggests	Profit was steady; the worst dip was a third of the gain	The account gave back everything it later earned, at one point

Account B still made money, but the margin for error was thin. A slightly worse run and the month could have finished at zero. The recovery factor makes that visible in a single number.

How to read a value

There is no official good or bad threshold, and anyone who gives you one is guessing. A few honest rules of thumb help you interpret your own numbers:

Below 1.0 means the account has not earned back its own worst drawdown yet. That is normal early on or after a bad run.
Around 1.0 to 2.0 means profit is about one to two times the worst dip. The result is positive but sensitive to a single bad stretch.
Above 2.0 or 3.0 means profit comfortably exceeds the worst dip. Whether that is realistic depends on your sample size and how long the period is.
A very high figure from a short period or a few trades usually says more about luck and a small sample than about skill.

Treat these as reading aids, not targets. A strategy with a modest recovery factor measured over a year of live trading tells you more than a spectacular figure from two weeks.

Why the period matters

Drawdown grows with time. The longer you trade, the more likely you are to meet a deeper dip, so the maximal drawdown in a report can only get bigger or stay the same as you add history. Net profit can rise or fall. As a result the recovery factor often looks flattering early in a winning run and then settles lower once a real losing streak arrives.

That is why it helps to compute it for fixed windows, such as each calendar month or each quarter, and compare windows with each other instead of staring at the all-time number. If you want to see how long a dip takes to recover, the drawdown recovery calculator shows the gain needed to get back from a given loss, and how to track drawdown in MT5 explains how to measure the dips themselves.

What the recovery factor does not tell you

How the profit was distributed. Ten small wins and one huge win can give the same ratio. Look at your average win and loss on the average win and loss calculator.
Whether the strategy will keep working. It is a backward-looking statistic.
Risk per trade. A trader who risks more per trade will usually have both bigger profits and bigger drawdowns, so the ratio can stay similar while the risk is very different.
Costs. If your profit figure excludes commission and swap, the real ratio is lower. Check the line labels in the report, and see how commission appears in MT5.
Anything about the future. A good number last quarter is not a promise for next quarter.

Using it in a trading journal

A journal turns a one-off number into a trend. If you record the recovery factor for each month, you can see whether your results are becoming steadier or more erratic. Pair it with notes on what you changed: a smaller position size, a rule about stopping after two losses, a new setup. When the number moves, you have a record of what you were doing at the time.

AI Trading Journal reads your closed trades from MetaTrader 5 and shows results on its dashboard (daily, weekly, monthly and all time), a P&L calendar and a Progress page with a growth curve and a months table. It does not display a recovery factor figure of its own, and it does not track floating profit on open trades. If you want the ratio, you can take the net result for a period from the journal or the Excel export and divide it by your largest drawdown from the MT5 report, the way the worked example above does.

A quick method to calculate it yourself

Pick a window, for example one calendar month, and note the net profit for that window from your history or the exported report.
Find the largest peak-to-trough drop in the same window, using the balance curve or the equity figure, consistently each time.
Divide net profit by that drop.
Write the three numbers in your journal with the date range so you can compare months later.

Limits of this page

The exact formula, the drawdown it uses and the menu names can differ between MetaTrader 5 builds and between the strategy tester and a trade report. Check your own report.
All numbers in the worked example are hypothetical.
This page explains a statistic. It is not trading advice and does not claim any level of the ratio is safe or profitable.

Frequently asked questions

What is the recovery factor in MT5?

It is the net profit divided by the largest drawdown. A value of 3.0 means the profit was three times the worst dip.

What is a good recovery factor?

There is no official threshold. Higher means profit was large compared with the worst dip, but short periods and small samples can produce high values by chance.

Is the recovery factor based on balance or equity drawdown?

That depends on the report. Read the labels in your own report and use the same drawdown when you compare periods.

Does AI Trading Journal show the recovery factor?

No. It shows net results, a P&L calendar, a growth curve and monthly tables. You can divide a period's net result by your largest drawdown yourself.

Can the recovery factor be negative?

Yes. If the net profit is negative, the ratio is negative, which simply says the account is below where it started for that window.

Related guides

Track every month's result in one local journal: free for 7 days

Free for 7 days, no card required. After that, a one-time $19.99 purchase. No subscription. Also on the Microsoft Store.

One-time $19.99, no monthly fee · your MT5 login never leaves your PC · trades go into your own journal on your PC, not through our servers.

Start free 7-day trial