66.15 -1.61 (-2.43%) Sell

Prayers for SHALPAINTS investors as it delivered massive losses

14 min read

SHALIM PAINTS LTD delivered massive losses on Friday. It delivered -2.43% to close at 66.15. On a day when the overall market breadth was 71%, it closed higher than 38% of the market. In comparison, the benchmark NIFTY-50 index closed today at +0.02%.

[Themes containing SHALPAINTS]

Buy-and-Hold investors in SHALPAINTS experienced a maximum drawdown of -39.56% over the last three months. It delivered -29.7% during this strong bearish trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals. The net profit from Short signals was +19.79%.


SHALPAINTS has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 17 May, 2017 to 18 Jan, 2019. One must note that SHALPAINTS is currently at it's worst performance to the NIFTY-50 index which makes it a bad investment candidate. Over the last 3 years and 1 month, SHALPAINTS underperformed the NIFTY-50 index on 57% days.

During the last three months SHALPAINTS was mostly loss making and delivered on average -0.5% per day. It's best return during this period (of +6.83%) was on Friday, 2 Nov, 2018. While it's worst loss in the same period (of -14.54%) was on Tuesday, 6 Nov, 2018. The longest stort-term trends during this period were 6 profitable and losing days. The bullish trend (which returned +25.7%) started on 29 Oct, 2018 and went on till 5 Nov, 2018 while the bearish trend (which returned -12.22%) started on 28 Nov, 2018 and went on till 5 Dec, 2018.

The last 12 months saw SHALPAINTS's investors making profits in 3 months and incurring losses in 9 months. SHALPAINTS was less consistent in delivering monthly returs than NIFTY-50 index. SHALPAINTS was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -32.6% compared to -6.42% returned by NIFTY-50 index in Sep 2018. SHALPAINTS had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from Nov 2018 to Jan 2019) during which period it delivered -30.24%. It is interesting to note that both SHALPAINTS and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

I never dreamed about success, I worked for it.
-- Estee Lauder

SHALPAINTS 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 SHALPAINTS's volatility from 19 Oct, 2018 to 7 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 SHALPAINTS has significant negative skewness in it's return distribution. This indicates that SHALPAINTS is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in SHALPAINTS you may find it interesting to know that IGARASHI, NIITTECH and MERCK have all shown remarkable performance this year and deserve to be on every investor's watchlist.

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