AXISBANK shows sign of weakness as investors do cost averaging
18 Dec, 201813 min read
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AXIS BANK LIMITED managed to outperform the broader market on Tuesday. It surged by +0.36% to close at 619.4. It is currently trading +25% above it's 52 week low of 492.25 and is down only -6% from it's 52 week high.
Buy-and-Hold investors in AXISBANK experienced a maximum drawdown of -12.92% over the last three months. It surged by +1.74% during this bullish trending period. There were both Long and Short signals during this period, while the long signals were significantly more profitable than the short signals.
AXISBANK has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 6 Sep, 2016 to 23 Oct, 2017. Over the last 2 years and 12 months, AXISBANK outperformed the NIFTY-50 index on 49% days. Which indicates that on days AXISBANK outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.
AXISBANK returned losses on 57% days in the last three months. During this time, it delivered on average +0.05% per day. It delivered it's best daily return of +6.58%, during this period, on Wednesday, 10 Oct, 2018. The longest stort-term trend during this period was 5 losing days, which started on 30 Nov, 2018 and ended on 6 Dec, 2018. This bearish trend lost -5.04% of investor capital.
During the last year AXISBANK had 6 profitable months and 6 loss making months. Profitable number of months of AXISBANK and NIFTY-50 index were the same. AXISBANK significantly outperformed NIFTY-50 index in Aug 2018, when it returned +17.96% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. AXISBANK and NIFTY-50 index, both had periods of 2 consecutive profitable months. It is interesting to note that both AXISBANK and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
I never dreamed about success, I worked for it.
-- Estee Lauder
AXISBANK is currently seeing overall fall in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant fall in AXISBANK's volatility from 21 Sep, 2018 to 5 Dec, 2018. While there was a significant fall in the NIFTY-50 index's volatility from 21 Sep, 2018 to 5 Dec, 2018.
Advanced/professional short-term investors should note that AXISBANK has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.
Investors trading in AXISBANK derivatives at this moment can consider 'Married Put' options strategy to receive better risk-adjusted returns.
AXISBANK has more chance of extreme outcomes than the NIFTY-50 index. Therefore, AXISBANK must receive a lower allocation than NIFTY-50 in your portfolio. NIFTY-50 index usually has shorter drawdown period than AXISBANK.
Based on your interest in AXISBANK you may find it interesting to know that MERCK and IGARASHI have both shown remarkable performance this year and deserve to be on every investors' watchlist.
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