Looking to invest in TYRES THEME? Look for alternatives because it performed worse than the broader market

Tyres performed worse than the broader market on Tuesday. It delivered +0.84% to close at 1647.54. On a day when the overall market breadth was 71%, it closed higher than 55% of the market. In comparison, the benchmark NIFTY-50 index closed today at +0.19%.

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~TYRES showed a bearish trend over the last 3 months. During this period ~TYRES fell by -7.05% and saw a maximum drawdown of -16.91%. There were 2 short signals during this period that returned a cumulative of +1.24% to investors.

Trend

Monthly Performance

Alpha (outperformance)

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Volatility

Return distribution

~TYRES has been underperforming the NIFTY-50 index in recent time. It showed significant outperformance (compared to the NIFTY-50 index) from 23 Jun, 2016 to 9 Jan, 2018. Over the last 2 years and 12 months, ~TYRES outperformed the NIFTY-50 index on 48% days. Which indicates that on days ~TYRES 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 ~TYRES delivered profits on 50% days. However, it still managed to end this period in a loss. It's best return during this period (of +4.84%) was on Wednesday, 10 Oct, 2018. While it's worst loss in the same period (of -4.17%) was on Friday, 21 Sep, 2018. The longest stort-term trends during this period were 6 profitable and losing days. The bullish trend (which returned +11.39%) started on 26 Oct, 2018 and went on till 2 Nov, 2018 while the bearish trend (which returned -6.9%) started on 3 Dec, 2018 and went on till 10 Dec, 2018.

During the last year ~TYRES had 6 profitable months and 6 loss making months. Profitable number of months of ~TYRES and NIFTY-50 index were the same. ~TYRES was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -20.66% compared to -6.42% returned by NIFTY-50 index in Sep 2018. ~TYRES and NIFTY-50 index, both had periods of 2 consecutive profitable months. It is interesting to note that both ~TYRES and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

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~TYRES 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 ~TYRES's volatility from 21 Sep, 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 ~TYRES has significant negative skewness in it's return distribution. This indicates that ~TYRES is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in ~TYRES you may find it interesting to know that LTI, CUB and LTTS are mid caps that have all shown remarkable performance and qualify to be on every investor's watchlist.