SELAN EXPLO. TECH LTD

178.05 -4.15 (-2.33%) Sell

Prayers for SELAN investors as it delivered massive losses

13 min read

SELAN EXPLO. TECH LTD is a falling knife that can bleed you if you catch it on Tuesday. It delivered -2.33% to close at 178.05. 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 SELAN]

SELAN is currently in a bearish trend. Over the last three months 3 bearish signals have generated a profit of +2.09% for investors.

Trend

SELAN has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 14 Jun, 2016 to 19 Dec, 2018. Over the last 3 years and 1 month, SELAN underperformed the NIFTY-50 index on 57% days.

SELAN returned losses on 61% days in the last three months. During this time, it delivered on average -0.15% per day. It delivered it's best daily return of +10.71%, during this period, on Thursday, 27 Dec, 2018. The longest stort-term trend during this period was 7 losing days, which started on 6 Nov, 2018 and ended on 15 Nov, 2018. This bearish trend lost -15.3% of investor capital.

The last 12 months saw SELAN's investors making profits in 4 months and incurring losses in 8 months. SELAN was less consistent in delivering monthly returs than NIFTY-50 index. SELAN significantly outperformed NIFTY-50 index in Apr 2018, when it returned +33.93% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. SELAN 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 -30.76%. It is interesting to note that both SELAN and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

Never spend your money before you have it.
-- Thomas Jefferson

SELAN 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 SELAN's volatility from 1 Nov, 2018 to 18 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 SELAN has significant negative skewness in it's return distribution. This indicates that SELAN is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in SELAN), three instruments that deserve special mention are ~CHEMICALS, BAJFINANCE and NIFTY-GS-15YRPLUS. They have all outperformed the market and must be closely watched for investment opportunities.

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