47.28 -1.62 (-3.43%) Sell

BDC investors disappointed by market underperformance

13 min read

BELDEN INC. was among the worst performers on Friday. It returned -3.43% to close at 47.28 which is it's 52 week low, down -45% from it's 52 week high.

[Themes containing BDC]

Buy-and-Hold investors in BDC experienced a maximum drawdown of -35.29% over the last three months. It returned -32.37% 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 +25.01%.


BDC has been underperforming the SP500 index in recent time, after having outperformed till 8 Dec, 2016. BDC is currently at it's worst performance to the SP500 index and therefore does not make a good investment candidate. Over the last 2 years 11 months and 3 days, BDC underperformed the SP500 index on 50% days. Which indicates that on days BDC underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months BDC was mostly loss making and delivered on average -0.59% per day. It's best return during this period (of +5.05%) was on Friday, 2 Nov, 2018. While it's worst loss in the same period (of -9.72%) was on Tuesday, 4 Dec, 2018. There was initially a bearish trend during this period which started on 4 Oct, 2018 and went on till 12 Oct, 2018. The trend delivered -16.6% losses to investors. This was followed by a bullish trend that started on 2 Nov, 2018 and ended on 7 Nov, 2018. This bullish trend delivered +7.93% to investors.

On monthly basis, BDC delivered losses in more months over the last year, than profits. BDC delivered profits less regularly than SP500 index. BDC was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -23.83% compared to -7.28% returned by SP500 index in Oct 2018. BDC had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from Feb 2018 to May 2018) during which period it delivered -36.27%. It is interesting to note that both BDC and SP500 index significantly outperform during months when quarterly/annual results are announced.

It's good to have money and the things that money can buy, but It's good, too, to check up once in a while and make sure that you haven't lost the things that money can't buy.
-- George Lorimer

BDC 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 BDC's volatility from 10 Sep, 2018 to 4 Dec, 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 BDC 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 BDC. Therefore, SP500 must receive a lower allocation than BDC in your portfolio. SP500 index usually has shorter drawdown period than BDC.

On a general note (since you are interested in BDC), three instruments that deserve special mention are ECYT, TPNL and NIHD. They have all outperformed the market and must be closely watched for investment opportunities.

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