Remember when we talked about Drawdown?

>No!
We looked at the maximum stock price over the past umpteen years and compared it to the most recent price to see ...

>To see how much we would have lost. Yes, I remember now.
Well, that was a negative look at the past, so now we ...

>We take a positive look, right?
Yes. We now look at the minimum stock price over the past umpteen years and compare it to the most recent price to see ...

>To see how much we would have gained!
Stop interrupting!
If Max is the maximum and Min is the minimum price over the past umpteen years, and P is the current price, we look at:

LOSS = 1 - P / Max and GAIN = P / Min - 1

For example, if the price dropped from a maximum of $50 to the current price of $30, then LOSS = 1- 30/50 = 0.4 or a loss of 40%.
If, over the same time period, the price increased from a minimum of $20 to the current price of $30, then GAIN = 30/20 - 1 = 0.5 or a gain of 50%.

>I'll take the gain!
Pay attention.
There's a spreadsheet that looks at the daily prices over a 5-year period. It looks like this:

>I take it you just click on the picture to download the spreadsheet?
Yes, as usual. A measure of how good or bad the stock has been is the Ratio: Average Gain/Average Loss.

G/L Ratio = Average[P / Min - 1] / Average[1 - P / Max]

>And if that's a big number, you buy the stock, right?
Of course! Everybody knows the future is a replica of the past!

Of course, you might also want to use this.

Here are a few G/L ratios (for the period June/03 to June/08):

DOW 7.0

Nasdaq 6.2

MSFT 3.2

GE 5.6

XOM 21.8

WMT 0.8

PFE 0.7

VZ 2.8

JNJ 5.9

C 1.7

KO 2.6

MRK 2.1

IBM 2.8

TSX 19.0

Brazil 30.4

Japan 6.7

U.K. 11.9

Australia 17.3

Shanghai 6.2

>Guess I'll buy the XOM.
Exxon-Mobil? Go right ahead ...