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Python

# -*- coding: utf-8 -*-
from numpy import log, seterr
from pandas import DataFrame, Series
from pandas_ta._typing import DictLike, Int
from pandas_ta.utils import v_offset, v_series
def drawdown(
close: Series, offset: Int = None, **kwargs: DictLike
) -> DataFrame:
"""Drawdown (DD)
Drawdown is a peak-to-trough decline during a specific period for an
investment, trading account, or fund. It is usually quoted as the
percentage between the peak and the subsequent trough.
Sources:
https://www.investopedia.com/terms/d/drawdown.asp
Args:
close (pd.Series): Series of 'close's.
offset (int): How many periods to offset the result. Default: 0
Kwargs:
fillna (value, optional): pd.DataFrame.fillna(value)
fill_method (value, optional): Type of fill method
Returns:
pd.DataFrame: drawdown, drawdown percent, drawdown log columns
"""
# Validate
close = v_series(close)
offset = v_offset(offset)
# Calculate
max_close = close.cummax()
dd = max_close - close
dd_pct = 1 - (close / max_close)
_np_err = seterr()
seterr(divide="ignore", invalid="ignore")
dd_log = log(max_close) - log(close)
seterr(divide=_np_err["divide"], invalid=_np_err["invalid"])
# Offset
if offset != 0:
dd = dd.shift(offset)
dd_pct = dd_pct.shift(offset)
dd_log = dd_log.shift(offset)
# Fill
if "fillna" in kwargs:
dd.fillna(kwargs["fillna"], inplace=True)
dd_pct.fillna(kwargs["fillna"], inplace=True)
dd_log.fillna(kwargs["fillna"], inplace=True)
if "fill_method" in kwargs:
dd.fillna(method=kwargs["fill_method"], inplace=True)
dd_pct.fillna(method=kwargs["fill_method"], inplace=True)
dd_log.fillna(method=kwargs["fill_method"], inplace=True)
# Name and Category
dd.name = "DD"
dd_pct.name = f"{dd.name}_PCT"
dd_log.name = f"{dd.name}_LOG"
dd.category = dd_pct.category = dd_log.category = "performance"
data = {dd.name: dd, dd_pct.name: dd_pct, dd_log.name: dd_log}
df = DataFrame(data)
df.name = dd.name
df.category = dd.category
return df