Logistics & Transportation THEME

610.595 -1.0 (-0.16%) Sell

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LOGISTICS THEME shows sign of weakness as investors do cost averaging

13 min read

~LOGISTICS managed to outperform the broader market today. On a longer term basis, investors in Logistics & Transportation made -0.06% per day. Friday's performance of -0.16% was a underperformance compared to it's daily average.

[Theme constituents]

~LOGISTICS showed a strong bearish trend over the last 3 months. During this period ~LOGISTICS fell by -13.46% and saw a maximum drawdown of -17.01%. There were 2 short signals during this period that returned a cumulative of +12.91% to investors.


~LOGISTICS has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 8 Jan, 2016 to 1 Oct, 2018. Over the last 2 years 11 months and 13 days, ~LOGISTICS underperformed the NIFTY-50 index on 54% days.

~LOGISTICS returned losses on 64% days in the last three months. During this time, it delivered on average -0.23% per day. It delivered it's best daily return of +4.15%, during this period, on Friday, 12 Oct, 2018. The longest stort-term trend during this period was 12 losing days, which started on 22 Nov, 2018 and ended on 10 Dec, 2018. This bearish trend lost -11.42% of investor capital.

During the last year ~LOGISTICS had 4 profitable months and 8 loss making months. ~LOGISTICS returned profits in fewer months than NIFTY-50 index. ~LOGISTICS was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -16.97% compared to -6.42% returned by NIFTY-50 index in Sep 2018. ~LOGISTICS had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from Jan 2018 to Mar 2018) during which period it delivered -20.55%. It is interesting to note that both ~LOGISTICS and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

Know what you own, and know why you own it.
-- Peter Lynch

~LOGISTICS is currently seeing overall fall in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant fall in ~LOGISTICS's volatility from 12 Oct, 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 ~LOGISTICS has significant negative skewness in it's return distribution. This indicates that ~LOGISTICS is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in ~LOGISTICS you may find it interesting to know that BAJFINANCE, BRITANNIA and ~MKTCAP201TO250 have all shown remarkable performance and qualify to be on every investor's watchlist.

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