7.44 -0.12 (-1.59%) Sell

Stop-loss on the minds of CART investors as it delivered massive losses

13 min read

CAROLINA TRUST BANCSHARES, INC. delivered massive losses on Friday. It lost -1.59% to close at 7.44 which is it's 52 week low, down -24% from it's 52 week high.

CART is currently in a down trend. The current bearish signal has generated a profit of +8.26% for investors in the last three months.


CART has been underperforming the SP500 index in recent time, after having outperformed till 22 Feb, 2017. Over the last 2 years 11 months and 10 days, CART underperformed the SP500 index on 48% days. Which indicates that on days CART underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

CART returned losses on 69% days in the last three months. During this time, it delivered on average -0.17% per day. It delivered it's worst daily return of -3.97%, during this period, on Thursday, 15 Nov, 2018. There was initially a bullish trend during this period which started on 1 Oct, 2018 and went on till 4 Oct, 2018. The bullish trend returned +1.58% to investors. This was followed by a bearish trend that started on 10 Dec, 2018 and ended on 12 Dec, 2018. This bearish trend lost -2.63% of investor capital.

CART had 7 profitable and 5 loss making months over the last year. During the last year, CART underperformed SP500 index on monthly return basis. CART was also a more risky investment than SP500 index as it's worst month in the last year, Apr 2018, returned -13.88% compared to -7.28% returned by SP500 index in Oct 2018. CART had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year. It is interesting to note that both CART and SP500 index significantly outperform during months when quarterly/annual results are announced.

"A bull market is very much like being in love. You don't realise its value till It's gone.

CART 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 CART's volatility from 23 Oct, 2018 to 14 Dec, 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 CART 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 CART. Therefore, SP500 must receive a lower allocation than CART in your portfolio. SP500 index usually has shorter drawdown period than CART.

On a general note (since you are interested in CART), three small cap instruments that deserve special mention are PTC, AAXN and KEYS. They have all outperformed the market and must be closely watched for investment opportunities.

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