Don't buy ALCO now, it is an investor's nightmare
13 Dec, 201813 min read
Share with friends 
ALICO INC significantly underperformed on Thursday. It lost -2.33% to close at 32.33. On a day when the overall market breadth was 35%, it closed higher than 70% of the market. In comparison, the benchmark SP500 index closed today at -0.0002%.
ALCO showed a down trend over the last 3 months. During this period ALCO lost -2.77% and saw a maximum drawdown of -6.7%. There was a short signal during this period which returned +0.19%.
ALCO has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 9 days, ALCO underperformed the SP500 index on 51% days.
ALCO was profitable on 50% days in the last three months. During this time, it delivered on average -0.04% per day. It delivered it's best daily return of +4.05%, during this period, on Friday, 21 Sep, 2018. There was initially a bearish trend during this period which started on 24 Sep, 2018 and went on till 26 Sep, 2018. The trend delivered -2.91% losses to investors. This was followed by a bullish trend that started on 7 Dec, 2018 and ended on 12 Dec, 2018. This bullish trend delivered +2.18% to investors.
ALCO had 6 profitable and 6 loss making months over the last year. During the last year, ALCO underperformed SP500 index on monthly return basis. ALCO significantly outperformed SP500 index in Apr 2018, when it returned +17.88% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ALCO had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.
"The way to become rich is to put all your eggs in one basket and then watch that basket.
ALCO 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 ALCO's volatility from 18 Sep, 2018 to 11 Dec, 2018. While there was a significant surge in the SP500 index's volatility from 25 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that ALCO 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 ALCO. Therefore, SP500 must receive a lower allocation than ALCO in your portfolio. SP500 index usually has shorter drawdown period than ALCO.
Based on your interest in ALCO you may find it interesting to know that ~SMALLCAP and AYTU have both shown remarkable performance and deserve to be on every investors' watchlist.
... we have a small favour to ask. Help us bring the power of algorithmic trading strategies to individual investors.
All content in this article was automatically generated by algorithms. This ensures that there are no human biases in the analysis provided. This approach to investing is not new and has been around for more than three decades. Yet, it has been available to only the most affluent or elite investors leaving individual investors to trade on emotions (such as fear and greed), intuition and poor analysis from third-parties. We want to change this.
We want to empower investors with all the tools and analysis required by them to make a rational investment decision.
If you found Spotalpha useful, consider making a contribution. For as little as $5 you can support our efforts and it takes less than a minute. Thank you. Contribute