100.35 -2.96 (-2.95%) Buy

EMKAY investors doing a reality check

13 min read

EMKAY GLOBAL FIN SERV LTD ranked among the worst performers today. It lost -2.95% to close at 100.35. During the last week it lost -4.84% and saw a maximum drawdown of -4.84%.

[Themes containing EMKAY]

Buy-and-Hold investors in EMKAY experienced a maximum drawdown of -13.63% over the last three months. It grew by +7.96% during this up trending period. There were both Long and Short signals during this period, while the long signals were significantly more profitable than the short signals.


EMKAY has been underperforming the NIFTY-50 index in recent time, after having outperformed till 18 Sep, 2017. Over the last 3 years and 1 month, EMKAY underperformed the NIFTY-50 index on 54% days.

During the last three months EMKAY delivered losses on 55% days. However, it still managed to end this period in a profit. It's best return during this period (of +15.34%) was on Wednesday, 21 Nov, 2018. While it's worst loss in the same period (of -4.84%) was on Wednesday, 31 Oct, 2018. There was initially a bearish trend during this period which started on 22 Nov, 2018 and went on till 28 Nov, 2018. The trend delivered -10.4% losses to investors. This was followed by a bullish trend that started on 29 Nov, 2018 and ended on 4 Dec, 2018. This bullish trend delivered +1.83% to investors.

EMKAY had 5 profitable and 7 loss making months over the last year. During the last year, number of profitable months of EMKAY and NIFTY-50 index were the same. EMKAY was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -31.38% compared to -6.42% returned by NIFTY-50 index in Sep 2018. EMKAY and NIFTY-50 index, both had periods of 2 consecutive profitable months. It is interesting to note that both EMKAY and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

What we now call 'finance' is, I hold, an intellectual perversion of what began as warm human love.
-- Robert Graves

EMKAY 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 EMKAY's volatility from 22 Oct, 2018 to 26 Oct, 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 EMKAY has significant negative skewness in it's return distribution. This indicates that EMKAY is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in EMKAY), two instruments that deserve special mention are IGARASHI and LTTS. They have significantly outperformed the overall market this year.

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