0.95 +0.05 (+5.56%) Sell

Profit booking on the minds of MIC investors as it performed better than the broader market

13 min read

MIC ELECTRONICS LIMITED was among the best performers on Friday. It returned +5.56% to close at 0.95. It is currently trading -92% below it's 52 week high of 12.2.

[Themes containing MIC]

MIC is currently in a down trend. Over the last three months 2 bearish signals have generated a profit of +25.03% for investors.


MIC has been underperforming the NIFTY-50 index in recent time, after having outperformed till 5 Jan, 2016. Over the last 3 years and 1 month, MIC underperformed the NIFTY-50 index on 61% days.

During the last three months MIC was mostly loss making and delivered on average -0.99% per day. It's best return during this period (of +7.5%) was on Monday, 10 Dec, 2018. While it's worst loss in the same period (of -9.09%) was on Wednesday, 26 Dec, 2018. There was initially a bullish trend during this period which started on 22 Oct, 2018 and went on till 30 Oct, 2018. The bullish trend returned +22.2% to investors. This was followed by a bearish trend that started on 20 Dec, 2018 and ended on 2 Jan, 2019. This bearish trend lost -47.89% of investor capital.

MIC had 3 profitable and 9 loss making months over the last year. During the last year, MIC underperformed NIFTY-50 index on monthly return basis. MIC was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Dec 2018, returned -38.64% compared to -6.42% returned by NIFTY-50 index in Sep 2018. MIC and NIFTY-50 index, both had periods of 2 consecutive profitable months. It is interesting to note that both MIC 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.

MIC 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 MIC's volatility from 29 Oct, 2018 to 27 Nov, 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 MIC has significant negative skewness in it's return distribution. This indicates that MIC is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in MIC), two instruments that deserve special mention are NIITTECH and CUB. They have significantly outperformed the overall market this year.

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