30.6 -0.68 (-2.24%) Sell

PSB investors dump it for better alternatives

13 min read

PUNJAB & SIND BANK delivered massive losses today. It lost -2.24% to close at 30.6. During the last week it lost -2.08% and saw a maximum drawdown of -3.16% before bouncing back.

[Themes containing PSB]

Buy-and-Hold investors in PSB experienced a maximum drawdown of -10.59% over the last three months. It returned +19.07% during this strong up trending period. There were both Long and Short signals during this period, while the long signals were significantly more profitable than the short signals. The net profit from Long signals was +6.93%.


PSB has been underperforming the NIFTY-50 index in recent time, after having outperformed till 4 May, 2017. Over the last 3 years and 1 month, PSB underperformed the NIFTY-50 index on 56% days.

During the last three months PSB delivered losses on 59% days. However, it still managed to end this period in a profit. It's best return during this period (of +15.14%) was on Thursday, 13 Dec, 2018. While it's worst loss in the same period (of -5.21%) was on Monday, 17 Dec, 2018. There was initially a bullish trend during this period which started on 26 Oct, 2018 and went on till 31 Oct, 2018. The bullish trend returned +14.08% to investors. This was followed by a bearish trend that started on 4 Dec, 2018 and ended on 10 Dec, 2018. This bearish trend lost -6.14% of investor capital.

PSB had 4 profitable and 8 loss making months over the last year. During the last year, PSB underperformed NIFTY-50 index on monthly return basis. PSB was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -20.8% compared to -6.42% returned by NIFTY-50 index in Sep 2018. PSB had a longer winning streak of losing months than NIFTY-50 index. It went down in 5 straight months (from Feb 2018 to Jun 2018) during which period it delivered -44.37%. It is interesting to note that both PSB and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

Formal education will make you a living; self-education will make you a fortune.
-- Jim Rohn

PSB 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 surge in PSB's volatility from 5 Dec, 2018 to 17 Dec, 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 PSB has significant negative skewness in it's return distribution. This indicates that PSB is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in PSB), IGARASHI is a small cap that deserves to be closely tracked for investment opportunities.

Want to improve your Portfolio's performance?

Spotalpha's Portfolio optimizer is all you need to improve your returns and reduce your risk.
Optimize Portfolio NOW
If you liked what you read here ...

... we have a small favour to ask. Help us bring the power of algorithmic trading strategies to individual investors.

All content in this article was automatically generated by algorithms. This ensures that there are no human biases in the analysis provided. This approach to investing is not new and has been around for more than three decades. Yet, it has been available to only the most affluent or elite investors leaving individual investors to trade on emotions (such as fear and greed), intuition and poor analysis from third-parties. We want to change this.

We want to empower investors with all the tools and analysis required by them to make a rational investment decision.

If you found Spotalpha useful, consider making a contribution. For as little as $5 you can support our efforts and it takes less than a minute. Thank you. Contribute
Share with friends   WhatsApp   Facebook   Twitter