NALWA SONS INVESTMENT LTD

1090.75 +41.58 (+3.81%) Sell

Don't go profit booking on NSIL now, it delivered a decent return

13 min read

NALWA SONS INVESTMENT LTD delivered stellar performance today. It gained +3.81% to close at 1090.75. It's recent 5 day performance has been -3.23%, +1.28%, -2.38%, +4.93% and +0.15%.

[Themes containing NSIL]

NSIL showed a up trend over the last 3 months. During this period NSIL gained +2.13% and saw a maximum drawdown of -12.52%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in NSIL till volatility reduces and a clear trend emerges.

Trend

NSIL has been underperforming the NIFTY-50 index in recent time, after having outperformed till 3 Jan, 2018. Over the last 3 years and 1 month, NSIL outperformed the NIFTY-50 index on 48% days. Which indicates that on days NSIL outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.

NSIL was profitable on 51% days in the last three months. During this time, it delivered on average +0.07% per day. It delivered it's worst daily return of -5.81%, during this period, on Wednesday, 2 Jan, 2019. There was initially a bullish trend during this period which started on 2 Nov, 2018 and went on till 9 Nov, 2018. The bullish trend returned +7.57% to investors. This was followed by a bearish trend that started on 19 Nov, 2018 and ended on 22 Nov, 2018. This bearish trend lost -5.43% of investor capital.

On monthly basis, NSIL delivered profits and losses in equal number of months. NSIL delivered profits in more months than NIFTY-50 index. NSIL was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Feb 2018, returned -13.36% compared to -6.42% returned by NIFTY-50 index in Sep 2018. NSIL had a longer winning streak of profitable months than NIFTY-50 index. It went up in 3 straight months (from Mar 2018 to May 2018) during which period it delivered +11.59%.

The stock market is filled with individuals who know the price of everything, but the value of nothing.
-- Philip Arthur Fisher

NSIL 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 NSIL's volatility from 19 Oct, 2018 to 1 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 NSIL has significant negative skewness in it's return distribution. This indicates that NSIL is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in NSIL), two small cap instruments that deserve special mention are RESPONIND and IGARASHI. They have significantly outperformed the overall market.

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