Tea & Coffee THEME

1448.08 -1.47 (-0.1%) Sell

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TEACOFFEE THEME continues its fall as more investors loose confidence

14 min read

Tea & Coffee showed weakness today. It lost -0.1% to close at 1448.08. During the last week it lost -0.5% and saw a maximum drawdown of -0.56% before bouncing back.

[Theme constituents]

Buy-and-Hold investors in ~TEACOFFEE experienced a maximum drawdown of -5.52% over the last three months. It lost -3.23% during this down trending period. There were no long signals during this period, where the short signal generated profits of +3.23% for investors.


~TEACOFFEE has been underperforming the NIFTY-50 index in recent time, after having outperformed till 30 Nov, 2017. Over the last 3 years and 1 month, ~TEACOFFEE underperformed the NIFTY-50 index on 51% days.

During the last three months ~TEACOFFEE was mostly loss making and delivered on average -0.05% per day. It's best return during this period (of +1.78%) was on Wednesday, 12 Dec, 2018. While it's worst loss in the same period (of -3.2%) was on Monday, 10 Dec, 2018. There was initially a bullish trend during this period which started on 29 Oct, 2018 and went on till 5 Nov, 2018. The bullish trend returned +5.14% to investors. This was followed by a bearish trend that started on 20 Dec, 2018 and ended on 26 Dec, 2018. This bearish trend lost -3.07% of investor capital.

~TEACOFFEE had 3 profitable and 9 loss making months over the last year. During the last year, ~TEACOFFEE underperformed NIFTY-50 index on monthly return basis. ~TEACOFFEE significantly outperformed NIFTY-50 index in Apr 2018, when it returned +15.8% compared to +6.56% returned by NIFTY-50 index during it's best month in the last one year - Jul 2018. ~TEACOFFEE had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from May 2018 to Jul 2018) during which period it delivered -12.59%. It is interesting to note that both ~TEACOFFEE and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

"Price is what you pay and value is what you get.

~TEACOFFEE 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 ~TEACOFFEE's volatility from 22 Oct, 2018 to 18 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 ~TEACOFFEE 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.

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

On a general note (since you are interested in ~TEACOFFEE), three instruments that have performed similar to ~TEACOFFEE are GEPIL, ~HINDUJAGRP and NIFTY-MIDCAP-50. They must all be evaluated as alternative investment options and for diversification.

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