LUX INDUSTRIES LIMITED

1256.65 +36.53 (+2.91%) Sell

Profit booking on the minds of LUXIND investors as it shows marginal outperformance

13 min read

LUX INDUSTRIES LIMITED delivered stellar performance on Wednesday. It gained +2.91% to close at 1256.65. It is currently trading -39% below it's 52 week high of 2072.85.

[Themes containing LUXIND]

Buy-and-Hold investors in LUXIND experienced a maximum drawdown of -31.67% over the last three months. It returned -15.09% during this strong down trending period. There were no long signals during this period, where the short signal generated good profits of +15.09% for investors.

Trend

LUXIND has been underperforming the NIFTY-50 index in recent time, after having outperformed till 9 May, 2018. Over the last 3 years and 1 month, LUXIND outperformed the NIFTY-50 index on 45% days. Which indicates that on days LUXIND outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.

LUXIND returned losses on 70% days in the last three months. During this time, it delivered on average -0.23% per day. It delivered it's best daily return of +11.35%, during this period, on Tuesday, 15 Jan, 2019. There was initially a bullish trend during this period which started on 31 Oct, 2018 and went on till 5 Nov, 2018. The bullish trend returned +6.69% to investors. This was followed by a bearish trend that started on 13 Dec, 2018 and ended on 31 Dec, 2018. This bearish trend lost -12.48% of investor capital.

On monthly basis, LUXIND delivered losses in more months over the last year, than profits. LUXIND delivered profits less regularly than NIFTY-50 index. LUXIND significantly outperformed NIFTY-50 index in Apr 2018, when it returned +13.68% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. LUXIND had a longer winning streak of losing months than NIFTY-50 index. It went down in 7 straight months (from Jul 2018 to Jan 2019) during which period it delivered -38.2%. It is interesting to note that both LUXIND and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"I believe that through knowledge and discipline, financial peace is possible for all of us.

LUXIND 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 surge in LUXIND's volatility from 26 Nov, 2018 to 15 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 LUXIND has significant negative skewness in it's return distribution. This indicates that LUXIND is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in LUXIND), BRITANNIA has performed really well and deserves to be closely tracked for investment opportunities.

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