81.51 +1.37 (+1.68%) Sell

Want to invest in ALL? Consider as it performed better than the broader market

13 min read

ALLSTATE CORP was among the best performers on Tuesday. It returned +1.68% to close at 81.51. It is currently trading -22% below it's 52 week high of 104.91.

[Themes containing ALL]

ALL showed a strong down trend over the last 3 months. During this period ALL returned -19.85% and saw a maximum drawdown of -22.28%. There was a short signal during this period which returned +21.18%.


ALL has been underperforming the SP500 index in recent time, after having outperformed till 4 Dec, 2017. Over the last 2 years 11 months and 14 days, ALL outperformed the SP500 index on 55% days.

During the last three months ALL was mostly loss making and delivered on average -0.35% per day. It's best return during this period (of +2.53%) was on Tuesday, 16 Oct, 2018. While it's worst loss in the same period (of -5.78%) was on Thursday, 1 Nov, 2018. There was initially a bullish trend during this period which started on 5 Nov, 2018 and went on till 9 Nov, 2018. The bullish trend returned +4.59% to investors. This was followed by a bearish trend that started on 3 Dec, 2018 and ended on 14 Dec, 2018. This bearish trend lost -11.65% of investor capital.

On monthly basis, ALL delivered losses in more months over the last year, than profits. ALL delivered profits less regularly than SP500 index. ALL was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -8.61% compared to -8.27% returned by SP500 index in Oct 2018. ALL had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from Sep 2018 to Dec 2018) during which period it delivered -14.43%. It is interesting to note that both ALL and SP500 index significantly outperform during months when quarterly/annual results are announced.

Here's my gift-giving rule: Respect your current financial situation.
-- Suze Orman

ALL 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 ALL's volatility from 5 Oct, 2018 to 11 Dec, 2018. While there was a significant surge in the SP500 index's volatility from 19 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that ALL has significant positive skewness in it's return distribution. This indicates that investors can expect ALL to recover from drawdowns quickly. Which makes ALL 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 ALL. Therefore, SP500 must receive a lower allocation than ALL in your portfolio. ALL usually has shorter drawdown period than the SP500 index.

On a general note (since you are interested in ALL), three small cap instruments that deserve special mention are KEYS, ZBRA and PTC. They have all outperformed the market and must be closely watched for investment opportunities.

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