219.65 -4.02 (-1.83%) Buy

Don't consider buying SUPRAJIT now, it is risky at the moment

13 min read

SUPRAJIT ENGINEERING LTD is a falling knife that can bleed you if you catch it today. It lost -1.83% to close at 219.65. It's recent 5 day performance has been -2.31%, +7.69%, -1.02%, -0.12% and -1.67%.

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SUPRAJIT showed a down trend over the last 3 months. During this period SUPRAJIT lost -6.67% and saw a maximum drawdown of -14.24%. There was a short signal during this period which returned +2.97%.


SUPRAJIT has been underperforming the NIFTY-50 index in recent time, after having outperformed till 23 Jun, 2017. Over the last 3 years and 1 month, SUPRAJIT outperformed the NIFTY-50 index on 46% days. Which indicates that on days SUPRAJIT outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.

SUPRAJIT returned losses on 59% days in the last three months. During this time, it delivered on average -0.08% per day. It delivered it's best daily return of +7.69%, during this period, on Wednesday, 16 Jan, 2019. 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 -5.95% losses to investors. This was followed by a bullish trend that started on 11 Dec, 2018 and ended on 19 Dec, 2018. This bullish trend delivered +12.28% to investors.

SUPRAJIT had 3 profitable and 9 loss making months over the last year. During the last year, SUPRAJIT underperformed NIFTY-50 index on monthly return basis. SUPRAJIT was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Jun 2018, returned -12.36% compared to -6.42% returned by NIFTY-50 index in Sep 2018. SUPRAJIT had a longer winning streak of losing months than NIFTY-50 index. It went down in 4 straight months (from Aug 2018 to Nov 2018) during which period it delivered -20.15%. It is interesting to note that both SUPRAJIT and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

It is time for us to stand and cheer for the doer, the achiever, the one who recognizes the challenge and does something about it.
-- Vince Lombardi

SUPRAJIT is becoming less 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 SUPRAJIT's volatility from 14 Dec, 2018 to 15 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 SUPRAJIT has significant negative skewness in it's return distribution. This indicates that SUPRAJIT is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in SUPRAJIT), three instruments that are extremely volatile are TIDEWATER, HATSUN and NIFTY50-DIV-POINT. They must all be evaluated prudently and investors are better off avoiding them at the moment.

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