BNFT investors herd to book profits while the going is good
18 Dec, 201813 min read
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BENEFITFOCUS,INC. delivered massive losses today. It lost -4.13% to close at 49.72. It's recent 5 day performance has been +1.09%, +0.79%, -5.11%, +1.26% and +4.25%.
BNFT showed a strong up trend over the last 3 months. During this period BNFT gained +24.14% and saw a maximum drawdown of -24.21%. There was a long signal during this period which returned +45.96%.
BNFT has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 14 days, BNFT outperformed the SP500 index on 52% days.
BNFT was profitable on 58% days in the last three months. During this time, it delivered on average +0.39% per day. It delivered it's worst daily return of -9.88%, during this period, on Wednesday, 10 Oct, 2018. There was initially a bearish trend during this period which started on 8 Oct, 2018 and went on till 11 Oct, 2018. The trend delivered -20.04% losses to investors. This was followed by a bullish trend that started on 25 Oct, 2018 and ended on 9 Nov, 2018. This bullish trend delivered +34.25% to investors.
BNFT had 6 profitable and 6 loss making months over the last year. During the last year, BNFT underperformed SP500 index on monthly return basis. BNFT significantly outperformed SP500 index in Aug 2018, when it returned +46.51% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. BNFT had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.
Risk comes from not knowing what you're doing.
-- Warren Buffett
BNFT 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 BNFT's volatility from 25 Sep, 2018 to 2 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 BNFT 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 BNFT. Therefore, SP500 must receive a lower allocation than BNFT in your portfolio. SP500 index usually has shorter drawdown period than BNFT.
On a general note (since you are interested in BNFT), AMRH has performed really well and deserves to be closely tracked for investment opportunities.
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