1107.9 -12.07 (-1.09%) Buy

HONDAPOWER investors herd to book profits while the going is good

13 min read

HONDA SIEL POWER PROD LTD delivered massive losses on Wednesday. It fell by -1.09% to close at 1107.9. It is currently trading -26% below it's 52 week high of 1511.1.

[Themes containing HONDAPOWER]

HONDAPOWER showed a bullish trend over the last 3 months. During this period HONDAPOWER surged by +2.67% and saw a maximum drawdown of -5.67%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in HONDAPOWER till volatility reduces and a clear trend emerges.


HONDAPOWER has been outperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 7 Nov, 2016 to 17 Dec, 2018. Over the last 3 years and 1 month, HONDAPOWER underperformed the NIFTY-50 index on 54% days.

HONDAPOWER returned losses on 59% days in the last three months. During this time, it delivered on average +0.05% per day. It delivered it's best daily return of +3.4%, during this period, on Tuesday, 1 Jan, 2019. The longest stort-term trends during this period were 5 profitable and losing days. The bullish trend (which returned +4.83%) started on 16 Jan, 2019 and went on till 22 Jan, 2019 while the bearish trend (which returned -1.84%) started on 9 Nov, 2018 and went on till 15 Nov, 2018.

During the last year HONDAPOWER had 7 profitable months and 5 loss making months. HONDAPOWER returned profits in more months than NIFTY-50 index. HONDAPOWER was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -16.43% compared to -6.42% returned by NIFTY-50 index in Sep 2018. HONDAPOWER had a longer winning streak of profitable months than NIFTY-50 index. It went up in 3 straight months (from Nov 2018 to Jan 2019) during which period it delivered +5.99%. It is interesting to note that both HONDAPOWER and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

We make a living by what we get, but we make a life by what we give.
-- Winston Churchill

HONDAPOWER is currently seeing overall fall in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant fall in HONDAPOWER's volatility from 24 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 HONDAPOWER has significant negative skewness in it's return distribution. This indicates that HONDAPOWER is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in HONDAPOWER you may find it interesting to know that MERCK, LTTS and VINATIORGA have all shown remarkable performance this year and deserve to be on every investor's watchlist.

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