How do you tell a strategy is actually decaying vs just in a normal drawdown?

Summary

• The post discusses the challenge of differentiating between a trading strategy’s natural drawdown and actual decay (loss of edge).
• The author proposes a statistical trigger: compare live drawdown depth/duration to the 95th percentile of the backtest distribution, and halve or kill the strategy if exceeded.
• They also monitor trade-level metrics (avg win/loss, hit rate) independently from P&L to detect edge erosion early.
• Quality assessment: This is a practical, well-reasoned methodological discussion, not a specific investment thesis. It qualifies as a thoughtful quant strategy management question, not noise.