HESTER BIOSCIENCES LTD is a falling knife that can bleed you if you catch it on Wednesday. It lost -2.17% to close at 1131.85. On a day when the overall market breadth was 70%, it closed higher than 77% of the market. In comparison, the benchmark NIFTY-50 index closed today at -0.0084%.
HESTERBIO showed a flat trend over the last 3 months. During this period HESTERBIO returned -0.81% and saw a maximum drawdown of -11.62%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in HESTERBIO till volatility reduces and a clear trend emerges.
HESTERBIO has been underperforming the NIFTY-50 index in recent time, after having outperformed till 26 Dec, 2017. Over the last 3 years and 1 month, HESTERBIO outperformed the NIFTY-50 index on 48% days. Which indicates that on days HESTERBIO outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.
HESTERBIO returned losses on 59% days in the last three months. During this time, it delivered on average 0.0% per day. It delivered it's best daily return of +5.63%, during this period, on Friday, 30 Nov, 2018. There was initially a bearish trend during this period which started on 4 Dec, 2018 and went on till 10 Dec, 2018. The trend delivered -10.51% losses to investors. This was followed by a bullish trend that started on 27 Dec, 2018 and ended on 2 Jan, 2019. This bullish trend delivered +6.44% to investors.
HESTERBIO had 6 profitable and 6 loss making months over the last year. HESTERBIO was profitable in more months than NIFTY-50 index. HESTERBIO was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -14.88% compared to -6.42% returned by NIFTY-50 index in Sep 2018. HESTERBIO had a longer winning streak of losing months than NIFTY-50 index. It went down in 4 straight months (from Apr 2018 to Jul 2018) during which period it delivered -29.24%. It is interesting to note that both HESTERBIO and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
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HESTERBIO 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 fall in HESTERBIO's volatility from 11 Dec, 2018 to 11 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 HESTERBIO has significant negative skewness in it's return distribution. This indicates that HESTERBIO is very risky for short-term investment and can significantly underperform for long durations.
NIFTY-50 index has more chance of extreme outcomes than HESTERBIO. Therefore, NIFTY-50 must receive a lower allocation than HESTERBIO in your portfolio. NIFTY-50 index usually has shorter drawdown period than HESTERBIO.
On a general note (since you are interested in HESTERBIO), two instruments that have been extremely volatile in recent times are HATSUN and NIFTY50-DIV-POINT. Investors in these instruments should consider reducing their exposure (to HATSUN and NIFTY50-DIV-POINT) and diversifying their portfolios.
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