NFL delivered lacklustre performance today. On a longer term basis, investors in NATIONAL FERT. LTD made +0.04% per day. Friday's performance of -0.28% was a underperformance compared to it's daily average.
NFL showed a flat trend over the last 3 months. During this period NFL delivered +0.85% and saw a maximum drawdown of -8.84%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in NFL till volatility reduces and a clear trend emerges.
NFL has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 11 May, 2017 to 6 Dec, 2018. Over the last 3 years and 1 month, NFL underperformed the NIFTY-50 index on 54% days.
During the last three months NFL delivered losses on 58% days. However, it still managed to end this period in a profit. It's best return during this period (of +6.31%) was on Wednesday, 31 Oct, 2018. While it's worst loss in the same period (of -3.23%) was on Thursday, 6 Dec, 2018. The longest stort-term trends during this period were 4 profitable and losing days. The bullish trend (which returned +7.05%) started on 17 Dec, 2018 and went on till 20 Dec, 2018 while the bearish trend (which returned -2.22%) started on 1 Jan, 2019 and went on till 4 Jan, 2019.
The last 12 months saw NFL's investors making profits in 3 months and incurring losses in 9 months. NFL was less consistent in delivering monthly returs than NIFTY-50 index. NFL was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -21.26% compared to -6.42% returned by NIFTY-50 index in Sep 2018. NFL had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from May 2018 to Jul 2018) during which period it delivered -20.08%. It is interesting to note that both NFL and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
"You have venture capitalists. We view them as experts who also help finance your company and give directions and also some pretty candid discussions about what you have to do better.
NFL is currently seeing overall fall in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant fall in NFL's volatility from 31 Oct, 2018 to 9 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 NFL has significant negative skewness in it's return distribution. This indicates that NFL is very risky for short-term investment and can significantly underperform for long durations.
NFL has more chance of extreme outcomes than the NIFTY-50 index. Therefore, NFL must receive a lower allocation than NIFTY-50 in your portfolio. NIFTY-50 index usually has shorter drawdown period than NFL.
Based on your interest in NFL you may find it interesting to know that IEX and SRIPIPES are highly volatile and therefore risky. Investors should consider limiting their exposure to these instruments (because of their volatile nature).
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