225.09 -12.59 (-5.59%) Sell

ANET investors dump it for better alternatives

13 min read

ARISTA NETWORKS, INC. significantly underperformed today. It lost -5.59% to close at 225.09. It's recent 5 day performance has been +3.79%, -5.81%, +2.27%, +0.92% and +0.39%.

[Themes containing ANET]

ANET is currently in a down trend. The current bearish signal has generated a profit of +10.42% for investors in the last three months.


ANET has been underperforming the SP500 index in recent time, after having outperformed till 15 Feb, 2018. Over the last 2 years 11 months and 3 days, ANET outperformed the SP500 index on 57% days.

During the last three months ANET was mostly loss making and delivered on average -0.24% per day. It's best return during this period (of +6.98%) was on Friday, 2 Nov, 2018. While it's worst loss in the same period (of -6.84%) was on Monday, 19 Nov, 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 -18.97% losses to investors. This was followed by a bullish trend that started on 30 Oct, 2018 and ended on 2 Nov, 2018. This bullish trend delivered +17.29% to investors.

ANET had 5 profitable and 7 loss making months over the last year. During the last year, ANET underperformed SP500 index on monthly return basis. ANET significantly outperformed SP500 index in Jan 2018, when it returned +19.39% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ANET and SP500 index, both had periods of 2 consecutive losing months. It is interesting to note that both ANET and SP500 index significantly outperform during months when quarterly/annual results are announced.

"Everything is always feasible if you run a corporate finance exercise: you can always try to come out with a justification on how things could work. But the real issue is to say how do you translate that into practice.

ANET 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 ANET's volatility from 20 Sep, 2018 to 2 Nov, 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 ANET 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 ANET derivatives at this moment can consider 'Bull Call Spread' options strategy to receive better risk-adjusted returns.

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

On a general note (since you are interested in ANET), AMRH has performed really well and deserves to be closely tracked for investment opportunities.

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