ADNT is a falling knife, continues to bleed every investor trying to catch it
07 Dec, 201813 min read
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ADIENT PLC was among the worst performers on Friday. It fell by -5.02% to close at 21.0 which is it's 52 week low, down -74% from it's 52 week high.
ADNT showed a strong bearish trend over the last 3 months. During this period ADNT fell by -49.12% and saw a maximum drawdown of -52.47%. There was a short signal during this period which returned +49.12%.
ADNT has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 26 Sep, 2017 to 9 Nov, 2018. Over the last 2 years 1 month and 7 day, ADNT underperformed the SP500 index on 49% days. Which indicates that on days ADNT underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.
During the last three months ADNT was mostly loss making and delivered on average -0.94% per day. It's best return during this period (of +11.94%) was on Tuesday, 13 Nov, 2018. While it's worst loss in the same period (of -25.36%) was on Friday, 9 Nov, 2018. The longest stort-term trend during this period was 10 losing days, which started on 24 Sep, 2018 and ended on 5 Oct, 2018. This bearish trend lost -25.46% of investor capital.
During the last year ADNT had 1 profitable months and 11 loss making months. ADNT returned profits in fewer months than SP500 index. ADNT was also a more risky investment than SP500 index as it's worst month in the last year, Nov 2018, returned -22.16% compared to -7.28% returned by SP500 index in Oct 2018. ADNT had a longer winning streak of losing months than SP500 index. It went down in 8 straight months (from May 2018 to Dec 2018) during which period it delivered -96.46%.
Many people take no care of their money till they come nearly to the end of it, and others do just the same with their time.
-- Johann Wolfgang von Goethe
ADNT is currently seeing overall increase in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in ADNT's volatility from 10 Sep, 2018 to 24 Oct, 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 ADNT has significant positive skewness in it's return distribution. This indicates that investors can expect ADNT to recover from drawdowns quickly. Which makes ADNT a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.
SP500 index has more chance of extreme outcomes than ADNT. Therefore, SP500 must receive a lower allocation than ADNT in your portfolio. ADNT usually has shorter drawdown period than the SP500 index.
Based on your interest in ADNT you may find it interesting to know that TPNL and AMRN have both shown remarkable performance this year and deserve to be on every investors' watchlist.
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