# Upside and downside capture

> Capture ratios split your benchmark relationship in two: how much of the benchmark's gains you captured on its good days, and how much of its losses you took on its bad ones.

> These figures are derived from a return series that the app currently flags as being reworked.
> Values and holdings are unaffected. See [about these numbers](/metrics/about-these-numbers).

[Beta](/metrics/beta) gives you one number for your relationship to the
benchmark, averaged across every day. Capture ratios split that relationship
into its two halves, because portfolios rarely behave the same way in both
directions.

**Upside capture** is how much of the benchmark's gains you got on the days it
rose. **Downside capture** is how much of its losses you took on the days it
fell.

## How it is calculated

Gylder sorts every day in the window by what the benchmark did, then sums both
sides:

```
upside capture   = Σ(your returns on benchmark up-days)   / Σ(benchmark returns on those days)
downside capture = Σ(your returns on benchmark down-days) / Σ(benchmark returns on those days)
```

Days the benchmark was exactly flat fall into neither bucket.

## How to read them

Both are expressed relative to 1, and the two are read in opposite directions.

**Upside capture above 1** means you gained more than the benchmark on its good
days. Below 1 means you lagged on the way up.

**Downside capture below 1** means you lost less than the benchmark on its bad
days. Above 1 means you fell harder.

The pair is more informative than either alone, because the shape of the
combination describes the portfolio's character. High upside with high
downside is amplification: you are essentially holding the benchmark with
leverage. Low upside with low downside is damping. High upside with low
downside is the asymmetry everyone wants and few sustain, and over a short
window it is far more likely to be a sampling artefact than a property of the
portfolio.

## Two things to watch

**The sign convention on the downside.** Both sums are negative on down days,
so the ratio comes out positive. A downside capture of 0.7 means you took 70%
of the benchmark's losses, which is the favourable case, even though nothing
about the number looks negative.

**These are sums, not compounded returns.** Gylder adds the daily returns
within each bucket rather than chaining them. That is a simplification, and it
means these figures should be read as a characterisation rather than as a
precise attribution of performance.

As everywhere in the risk grid, the numbers depend on which benchmark you
selected, and they recalculate when you change the window.