BLACK STONE MINERALS, L.P.

16.74 +0.24 (+1.45%) Sell

BSM investors update their stop-losses higher

13 min read

BLACK STONE MINERALS, L.P. showed marginal outperformance on Wednesday. It increased by +1.45% to close at 16.74. On a day when the overall market breadth was 35%, it closed higher than 68% of the market. In comparison, the benchmark SP500 index closed today at +0.54%.

[Themes containing BSM]

Buy-and-Hold investors in BSM experienced a maximum drawdown of -11.38% over the last three months. It delivered -9.27% during this bearish 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 +8.82%.

Trend

BSM has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 15 Sep, 2016 to 3 Aug, 2018. Over the last 2 years 11 months and 8 days, BSM underperformed the SP500 index on 50% days. Which indicates that on days BSM underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months BSM was mostly loss making and delivered on average -0.14% per day. It's best return during this period (of +4.24%) was on Tuesday, 6 Nov, 2018. While it's worst loss in the same period (of -3.89%) was on Tuesday, 20 Nov, 2018. The longest stort-term trend during this period was 5 losing days, which started on 7 Nov, 2018 and ended on 13 Nov, 2018. This bearish trend lost -6.32% of investor capital.

The last 12 months saw BSM's investors making profits in 5 months and incurring losses in 7 months. BSM was less consistent in delivering monthly returs than SP500 index. BSM significantly outperformed SP500 index in Aug 2018, when it returned +7.99% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. BSM had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from Sep 2018 to Dec 2018) during which period it delivered -10.82%.

It is not the man who has too little, but the man who craves more, that is poor.
-- Seneca

BSM 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 BSM's volatility from 19 Sep, 2018 to 6 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 13 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that BSM 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.

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

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

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