GUJARAT STATE PETRO LTD

182.45 +4.82 (+2.64%) Buy

GSPL continues to mint money for it's investors

15 min read

GUJARAT STATE PETRO LTD delivered stellar performance today. It gained +2.64% to close at 182.45. It's recent 5 day performance has been -0.08%, +4.74%, -0.12%, -0.79% and +0.79%.

[Themes containing GSPL]

GSPL showed a up trend over the last 3 months. During this period GSPL gained +8.83% and saw a maximum drawdown of -10.01%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in GSPL till volatility reduces and a clear trend emerges.

Trend

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

GSPL was profitable on 53% days in the last three months. During this time, it delivered on average +0.15% per day. It delivered it's best daily return of +4.74%, during this period, on Wednesday, 16 Jan, 2019. There was initially a bullish trend during this period which started on 26 Oct, 2018 and went on till 9 Nov, 2018. The bullish trend returned +12.29% to investors. This was followed by a bearish trend that started on 6 Dec, 2018 and ended on 10 Dec, 2018. This bearish trend lost -4.71% of investor capital.

GSPL had 6 profitable and 6 loss making months over the last year. GSPL was profitable in more months than NIFTY-50 index. GSPL significantly outperformed NIFTY-50 index in Jul 2018, when it returned +10.01% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. GSPL had a longer winning streak of profitable months than NIFTY-50 index. It went up in 3 straight months (from May 2018 to Jul 2018) during which period it delivered +10.86%. It is interesting to note that both GSPL and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"Finance is not merely about making money. It's about achieving our deep goals and protecting the fruits of our labor. It's about stewardship and, therefore, about achieving the good society.

GSPL 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 GSPL's volatility from 31 Oct, 2018 to 2 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 GSPL has significant negative skewness in it's return distribution. This indicates that GSPL is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in GSPL), if you are evaluating GSPL as an investment candidate, then you should read about L&TFH which has delivered similar performance and can help diversify your portfolio.

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