IND MOTOR PART & ACC LTD

881.15 -17.35 (-1.97%) Sell

IMPAL investors dump it for better alternatives

13 min read

IND MOTOR PART & ACC LTD delivered massive losses today. It lost -1.97% to close at 881.15. During the last week it grew by +0.82% and saw a maximum drawdown of -1.97% before bouncing back.

[Themes containing IMPAL]

Buy-and-Hold investors in IMPAL experienced a maximum drawdown of -7.23% over the last three months. It returned +0.21% during this flat trending period. There were no long signals during this period. However, the short signal was not profitable and lost investors -0.21%.

Trend

IMPAL has been underperforming the NIFTY-50 index in recent time, after having outperformed till 11 Jan, 2018. Over the last 3 years and 1 month, IMPAL underperformed the NIFTY-50 index on 50% days. Which indicates that on days IMPAL underperforms the NIFTY-50 index, it's performance is marginally worse than on the days it outperforms the NIFTY-50 index.

During the last three months IMPAL was mostly profitable and delivered on average +0.01% per day. It's best return during this period (of +3.23%) was on Thursday, 10 Jan, 2019. While it's worst loss in the same period (of -3.42%) was on Monday, 24 Dec, 2018. There was initially a bullish trend during this period which started on 2 Nov, 2018 and went on till 7 Nov, 2018. The bullish trend returned +3.63% to investors. This was followed by a bearish trend that started on 1 Jan, 2019 and ended on 4 Jan, 2019. This bearish trend lost -2.02% of investor capital.

IMPAL had 3 profitable and 9 loss making months over the last year. During the last year, IMPAL underperformed NIFTY-50 index on monthly return basis. IMPAL was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Mar 2018, returned -8.1% compared to -6.42% returned by NIFTY-50 index in Sep 2018. IMPAL had a longer winning streak of losing months than NIFTY-50 index. It went down in 6 straight months (from Feb 2018 to Jul 2018) during which period it delivered -27.43%. It is interesting to note that both IMPAL and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

My formula for success is rise early, work late and strike oil.
-- JP Getty

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

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

On a general note (since you are interested in IMPAL), three instruments that deserve special mention are NIFTY-GS-15YRPLUS, BAJFINANCE and ~MKTCAP201TO250. They have all outperformed the market and must be closely watched for investment opportunities.

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