31.09 +0.01 (+0.03%) Sell

ASTE shows sign of weakness as investors do cost averaging

13 min read

ASTEC INDUSTRIES INC managed to outperform the broader market on Tuesday. It surged by +0.03% to close at 31.09. On a day when the overall market breadth was 34%, it closed higher than 67% of the market. In comparison, the benchmark SP500 index closed today at +0.01%.

[Themes containing ASTE]

ASTE showed a strong bearish trend over the last 3 months. During this period ASTE fell by -39.37% and saw a maximum drawdown of -41.52%. There was a short signal during this period which returned +35.6%.


ASTE has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 7 Feb, 2017 to 13 Dec, 2018. Over the last 2 years 11 months and 14 days, ASTE underperformed the SP500 index on 48% days. Which indicates that on days ASTE underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

ASTE returned losses on 59% days in the last three months. During this time, it delivered on average -0.7% per day. It delivered it's worst daily return of -24.88%, during this period, on Tuesday, 23 Oct, 2018. The longest stort-term trend during this period was 5 losing days, which started on 4 Dec, 2018 and ended on 11 Dec, 2018. This bearish trend lost -12.14% of investor capital.

During the last year ASTE had 5 profitable months and 7 loss making months. ASTE returned profits in fewer months than SP500 index. ASTE was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -24.99% compared to -7.75% returned by SP500 index in Dec 2018. ASTE had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year.

Innovation distinguishes between a leader and a follower.
-- Steve Jobs

ASTE 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 ASTE's volatility from 21 Sep, 2018 to 23 Oct, 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 ASTE has positive skewness in it's return distribution. This indicates that investors can expect ASTE to make attempts to recover from drawdowns quickly. Which makes ASTE a good candidate for momentum based trading on short-term bullish trends or counter-trends.

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

Based on your interest in ASTE you may find it interesting to know that PTC is a small cap that has shown remarkable performance and deserves to be on every investors' watchlist.

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