92.5 -2.29 (-2.48%) Buy

Want to invest in UNIONBANK? Wait as it ranked worse than it's peers

17 min read

UNION BANK OF INDIA ranked among the worst performers on Friday. It returned -2.48% to close at 92.5. It is currently trading -37% below it's 52 week high of 148.9.

[Themes containing UNIONBANK]

UNIONBANK showed a strong up trend over the last 3 months. During this period UNIONBANK gained +43.41% and saw a maximum drawdown of -13.38%. There were 2 long signals during this period that returned a cumulative of +24.01% to investors.


UNIONBANK has been outperforming the NIFTY-50 index in recent time. Over the last 3 years and 1 month, UNIONBANK underperformed the NIFTY-50 index on 53% days.

UNIONBANK was profitable on 57% days in the last three months. During this time, it delivered on average +0.61% per day. It delivered it's best daily return of +12.15%, during this period, on Monday, 29 Oct, 2018. There was initially a bearish trend during this period which started on 4 Dec, 2018 and went on till 10 Dec, 2018. The trend delivered -11.93% 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 +15.22% to investors.

On monthly basis, UNIONBANK delivered profits in more months over the last year, than losses. UNIONBANK delivered profits in more months than NIFTY-50 index. UNIONBANK was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -26.74% compared to -6.42% returned by NIFTY-50 index in Sep 2018. UNIONBANK had a longer winning streak of profitable months than NIFTY-50 index. It went up in 4 straight months (from Oct 2018 to Jan 2019) during which period it delivered +30.29%. It is interesting to note that both UNIONBANK and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

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UNIONBANK 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 UNIONBANK's volatility from 29 Oct, 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 UNIONBANK has significant negative skewness in it's return distribution. This indicates that UNIONBANK is very risky for short-term investment and can significantly underperform for long durations.

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

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

On a general note (since you are interested in UNIONBANK), if you are evaluating UNIONBANK as an investment candidate, then you should read about HINDCOPPER which has delivered similar performance and can help diversify your portfolio.

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