20MICRONS shows sign of weakness as investors do cost averaging
18 Jan, 201913 min read
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20 MICRONS LTD managed to marginally outperform the broader market today. It gained +0.48% to close at 41.7. During the last week it lost -0.36% and saw a maximum drawdown of -0.84% before bouncing back.
Buy-and-Hold investors in 20MICRONS experienced a maximum drawdown of -10.75% over the last three months. It returned -0.83% during this flat trending period. There were both Long and Short signals during this period, where the short signals were marginally more profitable than the long signals.
20MICRONS has been underperforming the NIFTY-50 index in recent time, after having outperformed till 5 Jan, 2018. Over the last 3 years and 1 month, 20MICRONS underperformed the NIFTY-50 index on 56% days.
20MICRONS returned losses on 61% days in the last three months. During this time, it delivered on average +0.01% per day. It delivered it's best daily return of +6.77%, during this period, on Monday, 19 Nov, 2018. There was initially a bullish trend during this period which started on 26 Oct, 2018 and went on till 2 Nov, 2018. The bullish trend returned +10.56% to investors. This was followed by a bearish trend that started on 22 Nov, 2018 and ended on 30 Nov, 2018. This bearish trend lost -7.75% of investor capital.
20MICRONS had 3 profitable and 9 loss making months over the last year. During the last year, 20MICRONS underperformed NIFTY-50 index on monthly return basis. 20MICRONS significantly outperformed NIFTY-50 index in Aug 2018, when it returned +18.26% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. 20MICRONS had a longer winning streak of losing months than NIFTY-50 index. It went down in 5 straight months (from Feb 2018 to Jun 2018) during which period it delivered -38.52%. It is interesting to note that both 20MICRONS and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
If you are standing on the platform when the train has pulled away, It's not going to back up for you. When a bull market takes off, It's not going to back up for you.
-- Don Connelly
20MICRONS is becoming less volatile overall. In comparison, the NIFTY-50 index is seeing a fall in volatility. During the last three months, there was a significant fall in 20MICRONS's volatility from 19 Oct, 2018 to 18 Jan, 2019. While there was a significant fall in the NIFTY-50 index's volatility from 31 Oct, 2018 to 5 Dec, 2018.
Advanced/professional short-term investors should note that 20MICRONS has significant negative skewness in it's return distribution. This indicates that 20MICRONS is very risky for short-term investment and can significantly underperform for long durations.
NIFTY-50 index has more chance of extreme outcomes than 20MICRONS. Therefore, NIFTY-50 must receive a lower allocation than 20MICRONS in your portfolio. NIFTY-50 index usually has shorter drawdown period than 20MICRONS.
On a general note (since you are interested in 20MICRONS), SPLIL has performed really well this year and deserves to be closely tracked for investment opportunities.
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