38.5 -0.05 (-0.13%) Buy

J&KBANK investors doing a reality check

13 min read

J & K BANK LTD. trailed the broader market today. It returned -0.13% to close at 38.5. During the last week it grew by +3.22% and saw a maximum drawdown of -1.91% before bouncing back.

[Themes containing J&KBANK]

Buy-and-Hold investors in J&KBANK experienced a maximum drawdown of -17.29% over the last three months. It returned -9.31% during this down trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals. The net profit from Short signals was +7.54%.


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

During the last three months J&KBANK was mostly loss making and delivered on average -0.13% per day. It's best return during this period (of +6.28%) was on Monday, 29 Oct, 2018. While it's worst loss in the same period (of -7.63%) was on Thursday, 25 Oct, 2018. There was initially a bullish trend during this period which started on 26 Dec, 2018 and went on till 2 Jan, 2019. The bullish trend returned +6.01% to investors. This was followed by a bearish trend that started on 3 Jan, 2019 and ended on 11 Jan, 2019. This bearish trend lost -6.75% of investor capital.

On monthly basis, J&KBANK delivered losses in more months over the last year, than profits. J&KBANK delivered profits less regularly than NIFTY-50 index. J&KBANK was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -25.32% compared to -6.42% returned by NIFTY-50 index in Sep 2018. J&KBANK 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 -44.57%. It is interesting to note that both J&KBANK and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

The studios don't finance anymore, they get outside funds.
-- Robert Rodriguez

J&KBANK 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 J&KBANK's volatility from 23 Oct, 2018 to 31 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 J&KBANK has significant negative skewness in it's return distribution. This indicates that J&KBANK is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in J&KBANK), two instruments that have been extremely volatile in recent times are HATSUN and IEX. Investors in these instruments should consider reducing their exposure (to HATSUN and IEX) and diversifying their portfolios.

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