Stop-loss on the minds of CONSUMERGOODS THEME investors as it underperforms broader market
18 Jan, 201913 min read
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Consumer Goods underperformed on Friday. It lost -1.05% to close at 3869.5. It is currently trading -36% below it's 52 week high of 6113.24.
~CONSUMERGOODS is currently in a up trend. Over the last three months Buy-and-Hold has been a better strategy (returning -0.42%) for ~CONSUMERGOODS's investors than trading long signals.
~CONSUMERGOODS has been underperforming the NIFTY-50 index in recent time, after having outperformed till 1 Dec, 2017. Over the last 3 years and 1 month, ~CONSUMERGOODS outperformed the NIFTY-50 index on 45% days. Which indicates that on days ~CONSUMERGOODS 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 ~CONSUMERGOODS was mostly profitable and delivered on average +0.01% per day. It's best return during this period (of +4.7%) was on Tuesday, 18 Dec, 2018. While it's worst loss in the same period (of -5.54%) was on Friday, 7 Dec, 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 -13.23% losses to investors. This was followed by a bullish trend that started on 11 Dec, 2018 and ended on 20 Dec, 2018. This bullish trend delivered +12.46% to investors.
~CONSUMERGOODS had 6 profitable and 6 loss making months over the last year. During the last year, number of profitable months of ~CONSUMERGOODS and NIFTY-50 index were the same. ~CONSUMERGOODS was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Jun 2018, returned -15.77% compared to -6.02% returned by NIFTY-50 index in Sep 2018. ~CONSUMERGOODS and NIFTY-50 index, both had periods of 2 consecutive profitable months. It is interesting to note that both ~CONSUMERGOODS and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
"Of course, it is a little bit disingenuous to hint that hard work is the only thing you need to achieve success.
~CONSUMERGOODS 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 ~CONSUMERGOODS's volatility from 10 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 ~CONSUMERGOODS 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 ~CONSUMERGOODS. Therefore, NIFTY-50 must receive a lower allocation than ~CONSUMERGOODS in your portfolio. NIFTY-50 index usually has shorter drawdown period than ~CONSUMERGOODS.
On a general note (since you are interested in ~CONSUMERGOODS), three mid cap instruments that deserve special mention are HATSUN, LTI and CUB. They have all outperformed the market and must be closely watched for investment opportunities.
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