AAXN is a falling knife, continues to bleed every investor trying to catch it
07 Dec, 201813 min read
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AXON ENTERPRISE, INC. was among the worst performers today. It lost -2.22% to close at 43.52. During the last week it grew by +0.12% and saw a maximum drawdown of -3.67% before bouncing back.
AAXN is currently in a down trend. The current bearish signal has generated a profit of +24.52% for investors in the last three months.
AAXN has been underperforming the SP500 index in recent time, after having outperformed till 23 Jul, 2018. Over the last 2 years 11 months and 3 days, AAXN outperformed the SP500 index on 53% days.
During the last three months AAXN was mostly loss making and delivered on average -0.73% per day. It's best return during this period (of +7.33%) was on Tuesday, 16 Oct, 2018. While it's worst loss in the same period (of -15.61%) was on Wednesday, 7 Nov, 2018. There was initially a bearish trend during this period which started on 1 Nov, 2018 and went on till 8 Nov, 2018. The trend delivered -18.38% losses to investors. This was followed by a bullish trend that started on 21 Nov, 2018 and ended on 26 Nov, 2018. This bullish trend delivered +3.61% to investors.
AAXN had 8 profitable and 4 loss making months over the last year. During the last year, number of profitable months of AAXN and SP500 index were the same. AAXN significantly outperformed SP500 index in May 2018, when it returned +51.69% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. AAXN had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year. It is interesting to note that both AAXN and SP500 index significantly outperform during months when quarterly/annual results are announced.
"One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute.
AAXN is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in AAXN's volatility from 10 Sep, 2018 to 7 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 10 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that AAXN 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.
SP500 index has more chance of extreme outcomes than AAXN. Therefore, SP500 must receive a lower allocation than AAXN in your portfolio. SP500 index usually has shorter drawdown period than AAXN.
On a general note (since you are interested in AAXN), AMD is a mid cap that deserves to be closely tracked for investment opportunities.
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