INDIAN OIL CORP LTD is looking better than most other alternatives on Friday. It grew by +0.15% to close at 137.85. It is currently trading -29% below it's 52 week high of 195.18.
IOC showed a up trend over the last 3 months. During this period IOC grew by +9.06% and saw a maximum drawdown of -13.07%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in IOC till volatility reduces and a clear trend emerges.
IOC has been outperforming the NIFTY-50 index in recent time. Over the last 3 years and 1 month, IOC outperformed the NIFTY-50 index on 50% days. Which indicates that on days IOC outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.
During the last three months IOC was mostly profitable and delivered on average +0.17% per day. It's best return during this period (of +6.13%) was on Wednesday, 24 Oct, 2018. While it's worst loss in the same period (of -5.62%) was on Monday, 5 Nov, 2018. There was initially a bullish trend during this period which started on 12 Dec, 2018 and went on till 20 Dec, 2018. The bullish trend returned +12.09% to investors. This was followed by a bearish trend that started on 21 Dec, 2018 and ended on 27 Dec, 2018. This bearish trend lost -5.18% of investor capital.
IOC had 4 profitable and 8 loss making months over the last year. During the last year, IOC underperformed NIFTY-50 index on monthly return basis. IOC was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Jun 2018, returned -10.95% compared to -6.42% returned by NIFTY-50 index in Sep 2018. IOC had a longer winning streak of losing months than NIFTY-50 index. It went down in 4 straight months (from Aug 2018 to Nov 2018) during which period it delivered -19.3%. It is interesting to note that both IOC and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
If you do chose to invest in a share, invest for the lifetime.
-- Sandeep Sahajpal
IOC 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 IOC's volatility from 25 Oct, 2018 to 18 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 IOC has significant positive skewness in it's return distribution. This indicates that investors can expect IOC to recover from drawdowns quickly. Which makes IOC a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.
Investors trading in IOC derivatives at this moment can consider 'Long Strangle' options strategy to receive better risk-adjusted returns.
IOC has more chance of extreme outcomes than the NIFTY-50 index. Therefore, IOC must receive a lower allocation than NIFTY-50 in your portfolio. NIFTY-50 index usually has shorter drawdown period than IOC.
On a general note (since you are interested in IOC), BAJFINANCE has performed really well and deserves to be closely tracked for investment opportunities.
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