AKAMAI TECHNOLOGIES INC

66.65 -2.29 (-3.43%) Sell

Want to invest in AKAM? Avoid as it significantly underperformed

13 min read

AKAMAI TECHNOLOGIES INC significantly underperformed on Friday. It returned -3.43% to close at 66.65. On a day when the overall market breadth was 35%, it closed higher than 13% of the market. In comparison, the benchmark SP500 index closed today at -0.0233%.

[Themes containing AKAM]

AKAM showed a strong down trend over the last 3 months. During this period AKAM returned -13.16% and saw a maximum drawdown of -20.23%. There was a short signal during this period which returned +13.16%.

Trend

AKAM has been underperforming the SP500 index in recent time, after having outperformed till 28 Oct, 2016. Over the last 2 years 11 months and 3 days, AKAM underperformed the SP500 index on 46% days. Which indicates that on days AKAM underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

AKAM returned losses on 58% days in the last three months. During this time, it delivered on average -0.19% per day. It delivered it's best daily return of +16.92%, during this period, on Tuesday, 30 Oct, 2018. There was initially a bearish trend during this period which started on 4 Oct, 2018 and went on till 11 Oct, 2018. The trend delivered -12.68% losses to investors. This was followed by a bullish trend that started on 12 Oct, 2018 and ended on 17 Oct, 2018. This bullish trend delivered +6.94% to investors.

On monthly basis, AKAM delivered profits in more months over the last year, than losses. AKAM delivered profits less regularly than SP500 index. AKAM significantly outperformed SP500 index in Mar 2018, when it returned +5.22% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. AKAM had a shorter streak of profitable months than SP500 index. It only went up in 5 straight months during the last year. It is interesting to note that both AKAM and SP500 index significantly outperform during months when quarterly/annual results are announced.

"Your net worth to the world is usually determined by what remains after your bad habits are subtracted from your good ones.

AKAM is becoming more volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in AKAM's volatility from 28 Sep, 2018 to 30 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 AKAM 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.

Investors trading in AKAM derivatives at this moment can consider 'Bear Put Spread' options strategy to receive better risk-adjusted returns.

SP500 index has more chance of extreme outcomes than AKAM. Therefore, SP500 must receive a lower allocation than AKAM in your portfolio. SP500 index usually has shorter drawdown period than AKAM.

On a general note (since you are interested in AKAM), ABMD is a mid cap that deserves to be closely tracked for investment opportunities.

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