Pvt Banks THEME

1681.0 +4.74 (+0.28%) Buy

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Profit booking on the minds of BANKSPVT THEME investors as it shows marginal outperformance

14 min read

PVT Banks managed to marginally outperform the broader market today. It gained +0.28% to close at 1681.0. During the last week it gained +4.74%.

[Theme constituents]

Buy-and-Hold investors in ~BANKSPVT experienced a maximum drawdown of -14.57% over the last three months. It returned -5.26% during this down trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals.


~BANKSPVT has been outperforming the NIFTY-50 index in recent time. Over the last 2 years 11 months and 13 days, ~BANKSPVT outperformed the NIFTY-50 index on 51% days.

~BANKSPVT was profitable on 51% days in the last three months. During this time, it delivered on average -0.08% per day. It delivered it's worst daily return of -5.17%, during this period, on Friday, 21 Sep, 2018. There was initially a bearish trend during this period which started on 18 Sep, 2018 and went on till 25 Sep, 2018. The trend delivered -9.8% losses to investors. This was followed by a bullish trend that started on 29 Oct, 2018 and ended on 2 Nov, 2018. This bullish trend delivered +8.55% to investors.

On monthly basis, ~BANKSPVT delivered profits and losses in equal number of months. ~BANKSPVT delivered profits in more months than NIFTY-50 index. ~BANKSPVT was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -18.48% compared to -6.42% returned by NIFTY-50 index in Sep 2018. ~BANKSPVT 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 +7.21%. It is interesting to note that both ~BANKSPVT and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

Anyone who thinks there's safety in numbers hasn't looked at the stock market pages.
-- Irene Peter

~BANKSPVT 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 ~BANKSPVT's volatility from 21 Sep, 2018 to 4 Dec, 2018. While there was a significant fall in the NIFTY-50 index's volatility from 21 Sep, 2018 to 5 Dec, 2018.

Advanced/professional short-term investors should note that ~BANKSPVT 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.

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

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

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