Stop-loss on the minds of SHREECEM investors as it delivered massive losses

SHREE CEMENT LIMITED has destroyed investor wealth on Friday. It lost -2.04% to close at 15590.2. On a day when the overall market breadth was 71%, it closed higher than 60% of the market. In comparison, the benchmark NIFTY-50 index closed today at +0.02%.

[Themes containing SHREECEM]

SHREECEM is currently in a down trend. The previous short signal in SHREECEM has not been profitable for investors in general. If you are short on SHREECEM at current levels please make sure that your allocation is limited and that your portfolio is well diversified.

Trend

Monthly Performance

Alpha (outperformance)

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Volatility

Return distribution

SHREECEM has been underperforming the NIFTY-50 index in recent time, after having outperformed till 15 May, 2017. Over the last 3 years and 1 month, SHREECEM outperformed the NIFTY-50 index on 49% days. Which indicates that on days SHREECEM outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.

During the last three months SHREECEM was mostly profitable and delivered on average +0.13% per day. It's best return during this period (of +5.58%) was on Friday, 2 Nov, 2018. While it's worst loss in the same period (of -4.29%) was on Tuesday, 23 Oct, 2018. There was initially a bearish trend during this period which started on 22 Oct, 2018 and went on till 25 Oct, 2018. The trend delivered -7.06% losses to investors. This was followed by a bullish trend that started on 30 Oct, 2018 and ended on 12 Nov, 2018. This bullish trend delivered +13.29% to investors.

SHREECEM had 5 profitable and 7 loss making months over the last year. During the last year, number of profitable months of SHREECEM and NIFTY-50 index were the same. SHREECEM significantly outperformed NIFTY-50 index in Nov 2018, when it returned +18.47% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. SHREECEM and NIFTY-50 index, both had periods of 2 consecutive profitable months.

If you are standing on the platform when the train has pulled away, It's not going to back up for you. When a bull market takes off, It's not going to back up for you.
-- Don Connelly

SHREECEM 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 SHREECEM's volatility from 19 Oct, 2018 to 11 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 SHREECEM has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

Investors trading in SHREECEM derivatives at this moment can consider 'Long Straddle' options strategy to receive better risk-adjusted returns.

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

On a general note (since you are interested in SHREECEM), two mid cap instruments that deserve special mention are LTI and CUB. They have significantly outperformed the overall market.