SUZLON ENERGY LIMITED

5.25 -0.05 (-0.94%) Sell

Don't go shopping for SUZLON now, it is underperforming the market

17 min read

SUZLON delivered lacklustre performance today. On a longer term basis, investors in SUZLON ENERGY LIMITED made -0.09% per day. Friday's performance of -0.94% was a underperformance compared to it's daily average.

[Themes containing SUZLON]

SUZLON showed a strong bearish trend over the last 3 months. During this period SUZLON delivered -11.02% and saw a maximum drawdown of -19.05%. There was a short signal during this period which returned +11.02%.

Trend

SUZLON has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 5 Jan, 2016 to 28 Aug, 2018. Over the last 3 years and 1 month, SUZLON underperformed the NIFTY-50 index on 57% days.

During the last three months SUZLON was mostly loss making and delivered on average -0.16% per day. It's best return during this period (of +7.77%) was on Monday, 3 Dec, 2018. While it's worst loss in the same period (of -6.42%) was on Thursday, 29 Nov, 2018. The longest stort-term trend during this period was 7 profitable days, which started on 14 Dec, 2018 and went on till 24 Dec, 2018. This bullish trend returned +4.68% to investors.

The last 12 months saw SUZLON's investors making profits in 3 months and incurring losses in 9 months. SUZLON was less consistent in delivering monthly returs than NIFTY-50 index. SUZLON was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -23.78% compared to -6.42% returned by NIFTY-50 index in Sep 2018. SUZLON had a longer winning streak of losing months than NIFTY-50 index. It went down in 5 straight months (from Feb 2018 to Jun 2018) during which period it delivered -64.55%. It is interesting to note that both SUZLON and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"Finance is wholly different from the rest the economy.

SUZLON 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 SUZLON's volatility from 3 Dec, 2018 to 3 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 SUZLON has significant negative skewness in it's return distribution. This indicates that SUZLON is very risky for short-term investment and can significantly underperform for long durations.

Investors trading in SUZLON derivatives at this moment can consider 'Married Call' options strategy to receive better risk-adjusted returns.

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

Based on your interest in SUZLON you may find it interesting to know that MAXVIL has delivered similar performance as SUZLON and can be considered as an alternative investment candidate (to SUZLON).

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