393.8 +9.73 (+2.47%) Sell

EIHAHOTELS does a dead cat bounce, it's still too early to buy into it

13 min read

EIH ASSOCIATED HOTELS LTD was among the best performers on Friday. It returned +2.47% to close at 393.8. It is currently trading -37% below it's 52 week high of 632.55.

[Themes containing EIHAHOTELS]

EIHAHOTELS showed a strong up trend over the last 3 months. During this period EIHAHOTELS returned +30.07% and saw a maximum drawdown of -19.01%. There was a long signal during this period which returned +23.01%.


EIHAHOTELS has been outperforming the NIFTY-50 index in recent time. Over the last 3 years and 1 month, EIHAHOTELS outperformed the NIFTY-50 index on 46% days. Which indicates that on days EIHAHOTELS outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.

During the last three months EIHAHOTELS was mostly profitable and delivered on average +0.48% per day. It's best return during this period (of +18.71%) was on Monday, 17 Dec, 2018. While it's worst loss in the same period (of -5.75%) was on Tuesday, 18 Dec, 2018. There was initially a bearish trend during this period which started on 9 Nov, 2018 and went on till 20 Nov, 2018. The trend delivered -9.41% losses to investors. This was followed by a bullish trend that started on 21 Nov, 2018 and ended on 3 Dec, 2018. This bullish trend delivered +15.45% to investors.

On monthly basis, EIHAHOTELS delivered losses in more months over the last year, than profits. EIHAHOTELS delivered profits less regularly than NIFTY-50 index. EIHAHOTELS was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -25.71% compared to -6.42% returned by NIFTY-50 index in Sep 2018. EIHAHOTELS had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from Aug 2018 to Oct 2018) during which period it delivered -33.18%. It is interesting to note that both EIHAHOTELS and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

Frugality includes all the other virtues.
-- Cicero

EIHAHOTELS 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 surge in EIHAHOTELS's volatility from 19 Oct, 2018 to 30 Nov, 2018. 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 EIHAHOTELS has significant negative skewness in it's return distribution. This indicates that EIHAHOTELS is very risky for short-term investment and can significantly underperform for long durations.

NIFTY-50 index has more chance of extreme outcomes than EIHAHOTELS. Therefore, NIFTY-50 must receive a lower allocation than EIHAHOTELS in your portfolio. NIFTY-50 index usually has shorter drawdown period than EIHAHOTELS.

On a general note (since you are interested in EIHAHOTELS), IGARASHI is a small cap that deserves to be closely tracked for investment opportunities.

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