Are you evaluating investing in ZEEL? Wait as it delivered lacklustre performance

ZEE ENTERTAINMENT ENT LTD delivered lacklustre performance today. It lost -0.14% to close at 440.3. It's recent 5 day performance has been -2.48%, -1.03%, +1.94%, -0.65% and -0.07%.

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ZEEL showed a down trend over the last 3 months. During this period ZEEL lost -3.27% and saw a maximum drawdown of -12.97%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in ZEEL till volatility reduces and a clear trend emerges.

Trend

Monthly Performance

Alpha (outperformance)

Heatmap

Volatility

Return distribution

ZEEL has been underperforming the NIFTY-50 index in recent time, after having outperformed till 3 Oct, 2016. Over the last 3 years and 1 month, ZEEL underperformed the NIFTY-50 index on 50% days. Which indicates that on days ZEEL underperforms the NIFTY-50 index, it's performance is marginally worse than on the days it outperforms the NIFTY-50 index.

ZEEL returned losses on 53% days in the last three months. During this time, it delivered on average -0.03% per day. It delivered it's worst daily return of -7.8%, during this period, on Tuesday, 18 Dec, 2018. There was initially a bearish trend during this period which started on 22 Oct, 2018 and went on till 26 Oct, 2018. The trend delivered -7.57% losses to investors. This was followed by a bullish trend that started on 26 Dec, 2018 and ended on 1 Jan, 2019. This bullish trend delivered +9.62% to investors.

ZEEL had 4 profitable and 8 loss making months over the last year. During the last year, ZEEL underperformed NIFTY-50 index on monthly return basis. ZEEL was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -12.27% compared to -6.42% returned by NIFTY-50 index in Sep 2018. ZEEL had a longer winning streak of losing months than NIFTY-50 index. It went down in 5 straight months (from May 2018 to Sep 2018) during which period it delivered -26.88%. It is interesting to note that both ZEEL and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"I'm involved in the stock market, which is fun and, sometimes, very painful.

ZEEL 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 ZEEL's volatility from 19 Dec, 2018 to 14 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 ZEEL has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

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

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

On a general note (since you are interested in ZEEL), two instruments that deserve special mention are MERCK and RESPONIND. They have significantly outperformed the overall market this year.