12.69 +0.03 (+0.24%) Buy

Don't give up on AOBC now, it gave a fairly good return

13 min read

AMERICAN OUTDOOR BRANDS CORP ranked better than it's peers on Tuesday. It delivered +0.24% to close at 12.69. On a day when the overall market breadth was 34%, it closed higher than 18% of the market. In comparison, the benchmark SP500 index closed today at +0.01%.

[Themes containing AOBC]

AOBC showed a strong bearish trend over the last 3 months. During this period AOBC fell by -19.12% and saw a maximum drawdown of -24.95%. There was a short signal during this period which returned +2.96%.


AOBC has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 17 Mar, 2016 to 30 Aug, 2018. Over the last 2 years 11 months and 14 days, AOBC underperformed the SP500 index on 48% days. Which indicates that on days AOBC underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months AOBC was mostly loss making and delivered on average -0.3% per day. It's best return during this period (of +15.4%) was on Friday, 7 Dec, 2018. While it's worst loss in the same period (of -4.87%) was on Wednesday, 31 Oct, 2018. The longest stort-term trend during this period was 6 losing days, which started on 10 Dec, 2018 and ended on 17 Dec, 2018. This bearish trend lost -10.56% of investor capital.

During the last year AOBC had 6 profitable months and 6 loss making months. AOBC returned profits in fewer months than SP500 index. AOBC significantly outperformed SP500 index in Aug 2018, when it returned +48.15% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. AOBC had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year.

"Investors must keep in mind that there's a difference between a good company and a good stock. After all, you can buy a good car but pay too much for it .

AOBC is currently seeing overall fall in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in AOBC's volatility from 21 Sep, 2018 to 1 Nov, 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 AOBC 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 AOBC derivatives at this moment can consider 'Covered Call' options strategy to receive better risk-adjusted returns.

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

Based on your interest in AOBC you may find it interesting to know that RHT and ABMD are both mid caps that have shown remarkable performance and deserve to be on every investors' watchlist.

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