JUSTDIAL LTD. showed weakness on Friday. It lost -1.08% to close at 472.2. On a day when the overall market breadth was 71%, it closed higher than 19% of the market. In comparison, the benchmark NIFTY-50 index closed today at +0.02%.
JUSTDIAL is currently in a down trend. Over the last three months trading short signals has not been a profitable strategy for JUSTDIAL's investors in general. However, this strategy had significantly lower risk when compared to Buy-and-Hold investing (which returned -3.66%). It is therefore better to tread with caution in the current downtrend by limiting your allocation to JUSTDIAL.
JUSTDIAL has been underperforming the NIFTY-50 index in recent time, after having outperformed till 25 Apr, 2016. Over the last 3 years and 1 month, JUSTDIAL underperformed the NIFTY-50 index on 54% days.
During the last three months JUSTDIAL was mostly loss making and delivered on average -0.02% per day. It's best return during this period (of +11.49%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -5.18%) was on Tuesday, 23 Oct, 2018. There was initially a bullish trend during this period which started on 11 Dec, 2018 and went on till 14 Dec, 2018. The bullish trend returned +4.75% to investors. This was followed by a bearish trend that started on 28 Dec, 2018 and ended on 3 Jan, 2019. This bearish trend lost -4.61% of investor capital.
JUSTDIAL had 4 profitable and 8 loss making months over the last year. During the last year, JUSTDIAL underperformed NIFTY-50 index on monthly return basis. JUSTDIAL significantly outperformed NIFTY-50 index in May 2018, when it returned +31.3% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. JUSTDIAL had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from Feb 2018 to Apr 2018) during which period it delivered -22.14%. It is interesting to note that both JUSTDIAL and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
If you have trouble imagining a 20% loss in the stock market, you shouldn't be in stocks.
-- John Bogle
JUSTDIAL 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 JUSTDIAL's volatility from 23 Oct, 2018 to 20 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 JUSTDIAL has significant negative skewness in it's return distribution. This indicates that JUSTDIAL is very risky for short-term investment and can significantly underperform for long durations.
Investors trading in JUSTDIAL derivatives at this moment can consider 'Long Straddle' options strategy to receive better risk-adjusted returns.
NIFTY-50 index has more chance of extreme outcomes than JUSTDIAL. Therefore, NIFTY-50 must receive a lower allocation than JUSTDIAL in your portfolio. NIFTY-50 index usually has shorter drawdown period than JUSTDIAL.
On a general note (since you are interested in JUSTDIAL), if you are evaluating JUSTDIAL as an investment candidate, then you should read about PENINLAND which has delivered similar performance and can help diversify your portfolio.
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