120.9 -2.26 (-1.87%) Buy

INDOTECH investors check their stop-losses as it underperforms

13 min read

INDO TECH TRANSFORM LTD. was among the worst performers today. It lost -1.87% to close at 120.9. During the last week it gained +5.91% and saw a maximum drawdown of -5.88% before bouncing back.

[Themes containing INDOTECH]

Buy-and-Hold investors in INDOTECH experienced a maximum drawdown of -20.67% over the last three months. It gained +20.12% during this strong up trending period. There were both Long and Short signals during this period, while the long signals were significantly more profitable than the short signals. The net profit from Long signals was +11.07%.


INDOTECH has been outperforming the NIFTY-50 index in recent time. Over the last 3 years and 1 month, INDOTECH underperformed the NIFTY-50 index on 55% days.

INDOTECH returned losses on 54% days in the last three months. During this time, it delivered on average +0.37% per day. It delivered it's best daily return of +19.97%, during this period, on Thursday, 3 Jan, 2019. There was initially a bearish trend during this period which started on 16 Nov, 2018 and went on till 26 Nov, 2018. The trend delivered -8.35% losses to investors. This was followed by a bullish trend that started on 31 Dec, 2018 and ended on 3 Jan, 2019. This bullish trend delivered +31.6% to investors.

INDOTECH had 6 profitable and 6 loss making months over the last year. INDOTECH was profitable in more months than NIFTY-50 index. INDOTECH was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -32.67% compared to -6.42% returned by NIFTY-50 index in Sep 2018. INDOTECH had a longer winning streak of profitable months than NIFTY-50 index. It went up in 4 straight months (from Oct 2018 to Jan 2019) during which period it delivered +26.04%. It is interesting to note that both INDOTECH and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

The stock market clearly values companies that can deliver disruptive innovation.
-- Steve Blank

INDOTECH 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 INDOTECH's volatility from 22 Oct, 2018 to 18 Dec, 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 INDOTECH has significant negative skewness in it's return distribution. This indicates that INDOTECH is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in INDOTECH), three small cap instruments that deserve special mention are ASTRAZEN, IGARASHI and VINATIORGA. They have all outperformed the market and must be closely watched for investment opportunities.

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