Aluminium THEME

4063.09 -100.97 (-2.49%) Sell

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ALUMINIUM THEME continues its fall as more investors loose confidence

13 min read

Aluminium delivered lacklustre performance on Tuesday. It returned -2.49% to close at 4063.09. On a day when the overall market breadth was 70%, it closed higher than 89% of the market. In comparison, the benchmark NIFTY-50 index closed today at -0.0036%.

[Theme constituents]

Buy-and-Hold investors in ~ALUMINIUM experienced a maximum drawdown of -14.94% over the last three months. It returned +0.68% during this flat trending period. There were both Long and Short signals during this period, while the long signals were marginally more profitable than the short signals.


~ALUMINIUM has been underperforming the NIFTY-50 index in recent time, after having outperformed till 15 Jan, 2018. Over the last 3 years and 1 month, ~ALUMINIUM outperformed the NIFTY-50 index on 51% days.

~ALUMINIUM returned losses on 51% days in the last three months. During this time, it delivered on average +0.03% per day. It delivered it's best daily return of +4.34%, during this period, on Monday, 12 Nov, 2018. There was initially a bearish trend during this period which started on 4 Dec, 2018 and went on till 6 Dec, 2018. The trend delivered -6.98% losses to investors. This was followed by a bullish trend that started on 27 Dec, 2018 and ended on 2 Jan, 2019. This bullish trend delivered +2.49% to investors.

On monthly basis, ~ALUMINIUM delivered profits and losses in equal number of months. ~ALUMINIUM delivered profits in more months than NIFTY-50 index. ~ALUMINIUM significantly outperformed NIFTY-50 index in Apr 2018, when it returned +15.89% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. ~ALUMINIUM had a longer winning streak of profitable months than NIFTY-50 index. It went up in 3 straight months (from Oct 2018 to Dec 2018) during which period it delivered +12.22%. It is interesting to note that both ~ALUMINIUM and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

Try not to become a man of success. Rather become a man of value.
-- Albert Einstein

~ALUMINIUM 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 ~ALUMINIUM's volatility from 23 Oct, 2018 to 8 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 ~ALUMINIUM has significant positive skewness in it's return distribution. This indicates that investors can expect ~ALUMINIUM to recover from drawdowns quickly. Which makes ~ALUMINIUM a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

Based on your interest in ~ALUMINIUM you may find it interesting to know that LTTS and HATSUN are both mid caps that have shown remarkable performance and deserve to be on every investors' watchlist.

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