What causes the big drops in the indicator? like why is the first drop so huge compare to the others?
RoMaD isn’t really about what happens on the journey it is about what the final score is.
If you get a big drawdown on the way to the final score then it is a double whammy to the ratio at that point in time. Your return has dropped and your biggest draw down has increased so you see a massive drop in the ratio. At the end of the day the final score gives you an idea of the balance between the two things – maximum draw down and overall return.
