BRIGHTSPHERE INVESTMENT GROUP PLC

11.01 -0.34 (-3.08%) Sell

BSIG is a falling knife, continues to bleed every investor trying to catch it

13 min read

BSIG has destroyed investor wealth today. On a longer term basis, investors in BRIGHTSPHERE INVESTMENT GROUP PLC made +0.01% per day. Friday's performance of -3.08% was a underperformance compared to it's daily average.

[Themes containing BSIG]

BSIG showed a strong bearish trend over the last 3 months. During this period BSIG fell by -12.96% and saw a maximum drawdown of -17.16%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in BSIG till volatility reduces and a clear trend emerges.

Trend

BSIG has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 5 Jan, 2016 to 2 Oct, 2018. Over the last 2 years 11 months and 10 days, BSIG underperformed the SP500 index on 50% days. Which indicates that on days BSIG underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

BSIG returned losses on 58% days in the last three months. During this time, it delivered on average -0.19% per day. It delivered it's best daily return of +8.77%, during this period, on Thursday, 1 Nov, 2018. The longest stort-term trend during this period was 7 losing days, which started on 24 Sep, 2018 and ended on 2 Oct, 2018. This bearish trend lost -6.56% of investor capital.

During the last year BSIG had 5 profitable months and 7 loss making months. BSIG returned profits in fewer months than SP500 index. BSIG was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -16.4% compared to -7.28% returned by SP500 index in Oct 2018. BSIG had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Jun 2018 to Oct 2018) during which period it delivered -29.59%. It is interesting to note that both BSIG and SP500 index significantly outperform during months when quarterly/annual results are announced.

The only way to beat an index is to invest in something other than the index. Why would you, when the only source of long-term risk and return data is the index ?
-- Hebner, Mark.

BSIG is currently seeing overall increase in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in BSIG's volatility from 17 Sep, 2018 to 5 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 25 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that BSIG has significant positive skewness in it's return distribution. This indicates that investors can expect BSIG to recover from drawdowns quickly. Which makes BSIG a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

Based on your interest in BSIG you may find it interesting to know that EHC and KEYS are both small caps that have shown remarkable performance and deserve to be on every investors' watchlist.

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