Defined as the net profit divided by the maximum drawdown. It reflects how much gain was achieved per unit of drawdown risk. A strategy with $5,000 net profit and a $1,000 max drawdown has a recovery factor of 5.0. Higher is better (more profit for the same risk). MT5 explicitly reports “Recovery Factor” as profit / max drawdown. It is useful for comparing strategies where drawdown tolerance is a concern.

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