FINOLEX INDUSTRIES LTD

542.8 -16.11 (-2.97%) Buy

FINPIPE investors herd to book profits while the going is good

13 min read

FINOLEX INDUSTRIES LTD is a falling knife that can bleed you if you catch it today. It lost -2.97% to close at 542.8. It's recent 5 day performance has been +0.36%, +3.39%, +0.52%, +0.04% and +0.04%.

[Themes containing FINPIPE]

FINPIPE showed a strong up trend over the last 3 months. During this period FINPIPE gained +15.69% and saw a maximum drawdown of -9.42%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in FINPIPE till volatility reduces and a clear trend emerges.

Trend

FINPIPE has been outperforming the NIFTY-50 index in recent time. Over the last 3 years and 1 month, FINPIPE outperformed the NIFTY-50 index on 51% days.

FINPIPE was profitable on 57% days in the last three months. During this time, it delivered on average +0.25% per day. It delivered it's best daily return of +5.37%, during this period, on Wednesday, 24 Oct, 2018. There was initially a bearish trend during this period which started on 3 Dec, 2018 and went on till 10 Dec, 2018. The trend delivered -9.35% losses to investors. This was followed by a bullish trend that started on 8 Jan, 2019 and ended on 17 Jan, 2019. This bullish trend delivered +5.43% to investors.

FINPIPE had 7 profitable and 5 loss making months over the last year. FINPIPE was profitable in more months than NIFTY-50 index. FINPIPE was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -15.52% compared to -6.42% returned by NIFTY-50 index in Sep 2018. FINPIPE had a longer winning streak of profitable months than NIFTY-50 index. It went up in 3 straight months (from Feb 2018 to Apr 2018) during which period it delivered +2.15%. It is interesting to note that both FINPIPE and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"Finance is a gun. Politics is knowing when to pull the trigger.

FINPIPE is becoming more 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 FINPIPE's volatility from 29 Oct, 2018 to 22 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 FINPIPE has significant negative skewness in it's return distribution. This indicates that FINPIPE is very risky for short-term investment and can significantly underperform for long durations.

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

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

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