Stop-loss on the minds of MCLEODRUSS investors as it delivered massive losses
22 Jan, 201913 min read
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MCLEOD RUSSEL INDIA LTD. delivered massive losses on Tuesday. It lost -1.62% to close at 106.35. On a day when the overall market breadth was 70%, it closed higher than 17% of the market. In comparison, the benchmark NIFTY-50 index closed today at -0.0036%.
[Themes containing MCLEODRUSS]
Buy-and-Hold investors in MCLEODRUSS experienced a maximum drawdown of -23.9% over the last three months. It lost -18.13% during this strong down trending period. There were no long signals during this period, where the short signal generated good profits of +18.13% for investors.
MCLEODRUSS has been underperforming the NIFTY-50 index in recent time, after having outperformed till 11 Apr, 2016. MCLEODRUSS is currently at it's worst performance to the NIFTY-50 index and therefore does not make a good investment candidate. Over the last 3 years and 1 month, MCLEODRUSS underperformed the NIFTY-50 index on 54% days.
MCLEODRUSS returned losses on 70% days in the last three months. During this time, it delivered on average -0.31% per day. It delivered it's best daily return of +5.11%, during this period, on Monday, 5 Nov, 2018. There was initially a bullish trend during this period which started on 27 Dec, 2018 and went on till 31 Dec, 2018. The bullish trend returned +4.31% to investors. This was followed by a bearish trend that started on 14 Jan, 2019 and ended on 22 Jan, 2019. This bearish trend lost -6.67% of investor capital.
MCLEODRUSS had 3 profitable and 9 loss making months over the last year. During the last year, MCLEODRUSS underperformed NIFTY-50 index on monthly return basis. MCLEODRUSS significantly outperformed NIFTY-50 index in Aug 2018, when it returned +15.75% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. MCLEODRUSS had a longer winning streak of losing months than NIFTY-50 index. It went down in 5 straight months (from Sep 2018 to Jan 2019) during which period it delivered -38.73%.
"In this world nothing can be said to be certain, except death and taxes.
MCLEODRUSS 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 MCLEODRUSS's volatility from 6 Nov, 2018 to 17 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 MCLEODRUSS has significant negative skewness in it's return distribution. This indicates that MCLEODRUSS is very risky for short-term investment and can significantly underperform for long durations.
NIFTY-50 index has more chance of extreme outcomes than MCLEODRUSS. Therefore, NIFTY-50 must receive a lower allocation than MCLEODRUSS in your portfolio. NIFTY-50 index usually has shorter drawdown period than MCLEODRUSS.
Based on your interest in MCLEODRUSS you may find it interesting to know that HATSUN, CUB and LTTS are mid caps that have all shown remarkable performance and qualify to be on every investor's watchlist.
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