189.55 -0.75 (-0.39%) Sell

Prayers for SRIPIPES investors as it destroyed investor wealth

13 min read

SRIKALAHASTHI PIPES LTD ranked among the worst performers today. It delivered -0.39% to close at 189.55. During the last week it delivered -1.61% and saw a maximum drawdown of -1.69% before bouncing back.

SRIPIPES is currently in a bearish trend. Over the last three months trading short signals has not been a profitable strategy for SRIPIPES's investors in general. However, this strategy had significantly lower risk when compared to Buy-and-Hold investing (which returned -5.81%). It is therefore better to tread with caution in the current downtrend by limiting your allocation to SRIPIPES.


SRIPIPES has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 10 Jan, 2018 to 1 Oct, 2018. Over the last 2 years and 12 months, SRIPIPES underperformed the NIFTY-50 index on 54% days.

During the last three months SRIPIPES delivered profits on 50% days. However, it still managed to end this period in a loss. It's best return during this period (of +7.83%) was on Wednesday, 31 Oct, 2018. While it's worst loss in the same period (of -6.88%) was on Friday, 21 Sep, 2018. The longest stort-term trend during this period was 5 profitable days, which started on 26 Oct, 2018 and went on till 1 Nov, 2018. This bullish trend returned +15.17% to investors.

The last 12 months saw SRIPIPES's investors making profits in 4 months and incurring losses in 8 months. SRIPIPES was less consistent in delivering monthly returs than NIFTY-50 index. SRIPIPES was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Jun 2018, returned -19.91% compared to -6.42% returned by NIFTY-50 index in Sep 2018. SRIPIPES had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from Jan 2018 to Mar 2018) during which period it delivered -19.5%. It is interesting to note that both SRIPIPES and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"Inflation is taxation without legislation.

SRIPIPES 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 surge in SRIPIPES's volatility from 19 Sep, 2018 to 24 Sep, 2018. While there was a significant fall in the NIFTY-50 index's volatility from 21 Sep, 2018 to 5 Dec, 2018.

Advanced/professional short-term investors should note that SRIPIPES has significant negative skewness in it's return distribution. This indicates that SRIPIPES is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in SRIPIPES you may find it interesting to know that BATAINDIA, LTTS and LTI are mid caps that have all shown remarkable performance and qualify to be on every investor's watchlist.

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