ALLISON TRANSMISSION HOLDINGS INC

43.31 +0.18 (+0.42%) Sell

ALSN investors elated by performance

13 min read

ALLISON TRANSMISSION HOLDINGS INC delivered stellar performance on Friday. It gained +0.42% to close at 43.31. It is currently trading -18% below it's 52 week high of 53.44.

[Themes containing ALSN]

Buy-and-Hold investors in ALSN experienced a maximum drawdown of -20.7% over the last three months. It returned -16.36% during this strong down trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals. The net profit from Short signals was +9.03%.

Trend

ALSN has been underperforming the SP500 index in recent time, after having outperformed till 4 Oct, 2018. Over the last 2 years 11 months and 10 days, ALSN outperformed the SP500 index on 55% days.

ALSN returned losses on 51% days in the last three months. During this time, it delivered on average -0.27% per day. It delivered it's worst daily return of -4.39%, during this period, on Friday, 7 Dec, 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 -2.88% losses to investors. This was followed by a bullish trend that started on 12 Nov, 2018 and ended on 16 Nov, 2018. This bullish trend delivered +3.23% to investors.

On monthly basis, ALSN delivered profits in more months over the last year, than losses. ALSN delivered profits less regularly than SP500 index. ALSN significantly outperformed SP500 index in Jul 2018, when it returned +17.0% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ALSN had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year.

It is time for us to stand and cheer for the doer, the achiever, the one who recognizes the challenge and does something about it.
-- Vince Lombardi

ALSN 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 ALSN's volatility from 17 Sep, 2018 to 30 Oct, 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 ALSN 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 ALSN. Therefore, SP500 must receive a lower allocation than ALSN in your portfolio. SP500 index usually has shorter drawdown period than ALSN.

On a general note (since you are interested in ALSN), three instruments that are extremely volatile are OPNT, GNK and IMTE. They must all be evaluated prudently and investors are better off avoiding them at the moment.

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