USHA MARTIN LTD. underperformed broader market on Tuesday. It returned -1.48% to close at 33.2. On a day when the overall market breadth was 70%, it closed higher than 50% of the market. In comparison, the benchmark NIFTY-50 index closed today at -0.0036%.
USHAMART showed a strong up trend over the last 3 months. During this period USHAMART grew by +21.17% and saw a maximum drawdown of -27.8%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in USHAMART till volatility reduces and a clear trend emerges.
USHAMART has been underperforming the NIFTY-50 index in recent time, after having outperformed till 14 Nov, 2018. Over the last 3 years and 1 month, USHAMART outperformed the NIFTY-50 index on 42% days. Which indicates that on days USHAMART 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 USHAMART delivered losses on 56% days. However, it still managed to end this period in a profit. It's best return during this period (of +19.92%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -11.71%) was on Tuesday, 8 Jan, 2019. There was initially a bullish trend during this period which started on 30 Oct, 2018 and went on till 5 Nov, 2018. The bullish trend returned +47.86% to investors. This was followed by a bearish trend that started on 20 Nov, 2018 and ended on 28 Nov, 2018. This bearish trend lost -10.04% of investor capital.
On monthly basis, USHAMART delivered profits and losses in equal number of months. USHAMART delivered profits in more months than NIFTY-50 index. USHAMART significantly outperformed NIFTY-50 index in Jun 2018, when it returned +19.26% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. USHAMART had a longer winning streak of profitable months than NIFTY-50 index. It went up in 6 straight months (from Jun 2018 to Nov 2018) during which period it delivered +60.22%. It is interesting to note that both USHAMART and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
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USHAMART 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 USHAMART's volatility from 30 Oct, 2018 to 7 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 USHAMART has significant negative skewness in it's return distribution. This indicates that USHAMART is very risky for short-term investment and can significantly underperform for long durations.
NIFTY-50 index has more chance of extreme outcomes than USHAMART. Therefore, NIFTY-50 must receive a lower allocation than USHAMART in your portfolio. NIFTY-50 index usually has shorter drawdown period than USHAMART.
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