Weekly Drawdown Report: August 8, 2026

Average Market Severity Hits 5.3 as 42% of Stocks Enter Red Zone

As of August 8, 2026, UP (UP) is down 100% from its all-time high and has been in this drawdown for approximately 1,840 days. The stock carries a Drawdown Severity Score™ of 22.1, leading a group of 355 assets currently mired in the market's Red Zone. Across our database of 838 tracked assets, the average Drawdown Severity Score™ has risen to 5.3, signaling widespread systemic weakness.

The broader equity landscape is showing pronounced signs of stress as of August 8, 2026. Our database reveals that market-wide drawdowns are accelerating in both depth and duration. This weekly report breaks down the shifting risk profiles across our coverage universe.

Market Distribution Analysis

Our platform tracks a total of 838 assets to monitor the health of the broader market. As of August 8, 2026, the distribution of assets across our three risk zones shows a heavy skew toward high-risk territory.

The Red Zone, which contains assets with a Drawdown Severity Score™ of 5.0 or higher, now claims 355 assets. This represents 42.4% of our entire tracked database. This high concentration indicates that a significant portion of the market is experiencing prolonged or historically deep corrections.

In contrast, the Yellow Zone holds 236 assets, representing 28.2% of the database. These assets have a Drawdown Severity Score™ between 2.0 and 5.0, indicating moderate drawdowns that warrant close observation.

The Green Zone, representing the healthiest assets with a Drawdown Severity Score™ between 0.0 and 2.0, contains 247 assets. This accounts for 29.5% of our tracked universe. With less than a third of the market in the Green Zone, the average Drawdown Severity Score™ across all 838 assets has climbed to 5.3, placing the average tracked asset firmly in the Red Zone.

Weekly Zone Transitions

The week ending August 8, 2026, saw notable shifting between risk categories. A total of ten high-profile assets crossed key boundaries, reflecting both localized recoveries and deepening corrections.

Two assets deteriorated from the Yellow Zone into the Red Zone as of August 8, 2026. Kroger (KR) crossed the threshold to reach a Drawdown Severity Score™ of 5.1. Joining it in the high-risk category is ResMed (RMD), which saw its Drawdown Severity Score™ rise to 5.2.

Conversely, several assets managed to escape the Red Zone, transitioning back to the Yellow Zone. HONA (HONA) improved its status to a Drawdown Severity Score™ of 4.9. Similarly, JEDI (JEDI) climbed to a Drawdown Severity Score™ of 4.9. Other assets making this positive transition include Talon (TLN) at 4.8, BE Semiconductor Industries (BESIY) at 5.0, and International Paper (IP) at 5.0.

We also tracked transitions into the Green Zone, indicating significant recovery. ProShares Ultra QQQ (QLD) moved from yellow to green with a Drawdown Severity Score™ of 1.6. Interactive Brokers (IBKR) also entered the Green Zone, registering a Drawdown Severity Score™ of 1.9. On the downside, Diamondback Energy (FANG) slipped from green to yellow, posting a Drawdown Severity Score™ of 2.1.

Extreme Drawdowns and Highest Severity

A small group of assets continues to experience historically unprecedented declines. These names represent the most severe drawdowns in our database as of August 8, 2026.

UP leads the entire database with a Drawdown Severity Score™ of 22.1. The stock has been in a continuous drawdown for 1,842 days, leaving it down 99.8% from its peak. This represents a near-total wipeout of value over a span of more than five years.

The second most severe drawdown belongs to EU (EU), which carries a severity score of 20.6. This asset has been in a drawdown for an extraordinary 5,652 days, resulting in an 86.4% decline from its peak.

Other extreme cases include Nano Dimension (NNDM), which has a severity score of 19.5 and is down 98.2% over 3,782 days. American International Group (AIG) remains in its multi-decade post-financial crisis slump, with a severity score of 18.8, down 93.6% over 9,362 days. Finally, EPAM Systems (EPAM) rounds out the top five with a severity score of 18.5, down 86.4% over 1,724 days.

Historical Context of Multi-Year Drawdowns

The assets currently experiencing the highest severity scores highlight the extreme nature of long-term market declines. Our platform tracks these duration metrics to help differentiate between temporary pullbacks and secular changes.

For instance, AIG has remained in a continuous drawdown for 9,362 days as of August 8, 2026. This multi-decade correction dates back to the era preceding the 2008 global financial crisis. The asset has failed to regain its prior peak, demonstrating that some drawdowns can persist across multiple market cycles.

Similarly, EU has spent 5,652 days in its current drawdown, resulting in an 86.4% decline from its all-time high. This long-term stagnation reflects deep structural challenges that have prevented a sustained recovery.

In contrast, assets like UP and EPAM represent more compressed, high-velocity drawdowns. UP has lost 99.8% of its value over 1,842 days, showing how quickly modern growth assets can devalue. EPAM has lost 86.4% over 1,724 days, indicating a comparable rate of descent.

Assets Approaching the Red Zone

Several assets are currently hovering right on the edge of the Red Zone. These stocks demand close attention as even minor downward movements could push their Drawdown Severity Scores™ past the critical 5.0 threshold.

West Pharmaceutical Services (WST) sits directly on the line with a Drawdown Severity Score™ of 5.0. It has been in a drawdown for 1,672 days and is currently down 24.1% from its peak.

SPDR Gold Shares (GLD) also registers a Drawdown Severity Score™ of 5.0. The gold trust is down 19.6% from its high, with a drawdown duration of 181 days.

Additionally, BESIY and IP both carry a Drawdown Severity Score™ of 5.0. BESIY has fallen 30.8% over a brief 49 days, while IP has declined 28.0% over 549 days.

Just below the boundary is Lam Research (LRCX) with a Drawdown Severity Score™ of 4.9, down 28.1% over 30 days. Other names at 4.9 include JEDI down 30.5% over 63 days, L3Harris Technologies (LHX) down 24.3% over 149 days, and HONA down 37.6% over 51 days.

Market-Wide Risk and Index Components

The high proportion of assets in the Red Zone indicates that risk is not isolated to speculative sectors. With 42.4% of tracked equities exhibiting a Drawdown Severity Score™ of 5.0 or higher, the broader indices are experiencing significant pressure.

The presence of major defensive and industrial assets like IP and LHX near the Red Zone shows the breadth of the current pullback. Even commodities-linked assets like GLD are showing elevated Drawdown Severity Scores™, indicating that traditional safe havens are not immune to the current market dynamics.

Our data shows that the average Drawdown Severity Score™ of 5.3 is heavily influenced by these persistent, mid-to-high-digit percentage drawdowns. While some growth components have stabilized, the overall market trend remains heavily weighted toward risk mitigation rather than recovery.

What to Watch Next Week

Heading into the next reporting period, our analysts will be watching the cluster of assets sitting at the 4.9 and 5.0 severity thresholds. These boundary-line assets will determine whether the market-wide average Drawdown Severity Score™ of 5.3 continues to climb or begins to stabilize.

Specifically, we will monitor whether LRCX and LHX cross over into the Red Zone. If these assets experience further price declines, they will likely push past the 5.0 Drawdown Severity Score™ mark.

Conversely, we will watch if BESIY and IP can build on their recent transitions and distance themselves from the Red Zone boundary. Their ability to sustain upward momentum will be a key indicator of whether the broader market's defensive posture is starting to thaw.