1122.35 +4.39 (+0.39%) Sell

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GLASS THEME is a falling knife, continues to bleed every investor trying to catch it

13 min read

Glass was among the worst performers today. It returned +0.39% to close at 1122.35. During the last week it returned +0.96% and saw a maximum drawdown of -2.03% before bouncing back.

[Theme constituents]

Buy-and-Hold investors in ~GLASS experienced a maximum drawdown of -16.43% over the last three months. It lost -15.63% during this strong 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. The net profit from Short signals was +12.1%.


~GLASS has been underperforming the NIFTY-50 index in recent time, after having outperformed till 15 Jan, 2018. Over the last 2 years 11 months and 13 days, ~GLASS underperformed the NIFTY-50 index on 51% days.

During the last three months ~GLASS was mostly loss making and delivered on average -0.27% per day. It's best return during this period (of +3.94%) was on Wednesday, 26 Sep, 2018. While it's worst loss in the same period (of -4.4%) was on Thursday, 4 Oct, 2018. There was initially a bearish trend during this period which started on 27 Sep, 2018 and went on till 9 Oct, 2018. The trend delivered -12.17% losses to investors. This was followed by a bullish trend that started on 12 Oct, 2018 and ended on 16 Oct, 2018. This bullish trend delivered +1.23% to investors.

~GLASS had 4 profitable and 8 loss making months over the last year. During the last year, ~GLASS underperformed NIFTY-50 index on monthly return basis. ~GLASS was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -9.05% compared to -6.42% returned by NIFTY-50 index in Sep 2018. ~GLASS had a longer winning streak of losing months than NIFTY-50 index. It went down in 4 straight months (from Sep 2018 to Dec 2018) during which period it delivered -18.56%. It is interesting to note that both ~GLASS and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

The stock market clearly values companies that can deliver disruptive innovation.
-- Steve Blank

~GLASS 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 surge in ~GLASS's volatility from 17 Sep, 2018 to 4 Oct, 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 ~GLASS has significant negative skewness in it's return distribution. This indicates that ~GLASS is very risky for short-term investment and can significantly underperform for long durations.

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

On a general note (since you are interested in ~GLASS), DMART is a large cap that deserves to be closely tracked for investment opportunities.

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