S H KELKAR AND CO. LTD.

171.65 -0.6 (-0.35%) Buy

Stop-loss on the minds of SHK investors as it ranked worse than it's peers

13 min read

S H KELKAR AND CO. LTD. ranked worse than it's peers on Wednesday. It fell by -0.35% to close at 171.65. On a day when the overall market breadth was 70%, it closed higher than 29% of the market. In comparison, the benchmark NIFTY-50 index closed today at -0.0084%.

[Themes containing SHK]

SHK is currently in a bullish trend. Over the last three months trading long signals has not been a profitable strategy for SHK's investors in general. However, this strategy had significantly lower risk when compared to Buy-and-Hold investing (which returned -10.11%). It is therefore better to tread with caution in the current uptrend by limiting your allocation to SHK.

Trend

SHK has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 4 Jan, 2017 to 18 Dec, 2018. Over the last 3 years and 1 month, SHK underperformed the NIFTY-50 index on 53% days.

During the last three months SHK was mostly loss making and delivered on average -0.14% per day. It's best return during this period (of +6.16%) was on Monday, 3 Dec, 2018. While it's worst loss in the same period (of -7.78%) was on Thursday, 25 Oct, 2018. The longest stort-term trend during this period was 6 profitable days, which started on 1 Nov, 2018 and went on till 9 Nov, 2018. This bullish trend returned +14.45% to investors.

During the last year SHK had 2 profitable months and 10 loss making months. SHK returned profits in fewer months than NIFTY-50 index. SHK was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Oct 2018, returned -19.13% compared to -6.42% returned by NIFTY-50 index in Sep 2018. SHK had a longer winning streak of losing months than NIFTY-50 index. It went down in 6 straight months (from Feb 2018 to Jul 2018) during which period it delivered -41.7%.

As long as you're going to be thinking anyway, think big.
-- Donald Trump

SHK is currently seeing overall increase in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant fall in SHK's volatility from 2 Nov, 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 SHK has significant negative skewness in it's return distribution. This indicates that SHK is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in SHK you may find it interesting to know that RESPONIND, VINATIORGA and ASTRAZEN are small caps that have all shown remarkable performance and qualify to be on every investor's watchlist.

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