Don't go profit booking on MKTCAP151TO200 THEME now, it delivered a decent return

Market Cap 151-200 managed to outperform the broader market on Friday. It surged by +0.25% to close at 1352.52. On a day when the overall market breadth was 71%, it closed higher than 47% of the market. In comparison, the benchmark NIFTY-50 index closed today at +0.13%.

[Theme constituents]

~MKTCAP151TO200 showed a bearish trend over the last 3 months. During this period ~MKTCAP151TO200 delivered -9.81% and saw a maximum drawdown of -17.11%. There were 2 short signals during this period that returned a cumulative of +9.81% to investors.

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Monthly Performance

Alpha (outperformance)

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Return distribution

~MKTCAP151TO200 has been outperforming the NIFTY-50 index in recent time. It showed significant outperformance (compared to the NIFTY-50 index) from 15 Nov, 2016 to 11 Jan, 2018. Over the last 2 years and 2 months, ~MKTCAP151TO200 outperformed the NIFTY-50 index on 58% days.

~MKTCAP151TO200 returned losses on 54% days in the last three months. During this time, it delivered on average -0.16% per day. It delivered it's best daily return of +4.15%, during this period, on Wednesday, 10 Oct, 2018. The longest stort-term trend during this period was 6 profitable days, which started on 26 Oct, 2018 and went on till 2 Nov, 2018. This bullish trend returned +7.88% to investors.

The last 12 months saw ~MKTCAP151TO200's investors making profits in 6 months and incurring losses in 6 months. During the last year, ~MKTCAP151TO200 delivered profits in more months than NIFTY-50 index. ~MKTCAP151TO200 was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -14.86% compared to -6.42% returned by NIFTY-50 index in Sep 2018. ~MKTCAP151TO200 and NIFTY-50 index, both had periods of 2 consecutive profitable months. It is interesting to note that both ~MKTCAP151TO200 and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"In this world nothing can be said to be certain, except death and taxes.

~MKTCAP151TO200 is currently seeing overall increase in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant surge in ~MKTCAP151TO200's volatility from 17 Sep, 2018 to 12 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 ~MKTCAP151TO200 has significant positive skewness in it's return distribution. This indicates that investors can expect ~MKTCAP151TO200 to recover from drawdowns quickly. Which makes ~MKTCAP151TO200 a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

NIFTY-50 index has more chance of extreme outcomes than ~MKTCAP151TO200. Therefore, NIFTY-50 must receive a lower allocation than ~MKTCAP151TO200 in your portfolio. ~MKTCAP151TO200 usually has shorter drawdown period than the NIFTY-50 index.

Based on your interest in ~MKTCAP151TO200 you may find it interesting to know that VINATIORGA, IGARASHI and NIITTECH are small caps that have all shown remarkable performance and qualify to be on every investor's watchlist.