CHUBB LTD

127.92 -2.28 (-1.78%) Buy

Search for alternative investments is on for CB investors as it performed worse than the broader market

13 min read

CHUBB LTD delivered massive losses on Tuesday. It returned -1.78% to close at 127.92. On a day when the overall market breadth was 35%, it closed higher than 13% of the market. In comparison, the benchmark SP500 index closed today at -0.0004%.

[Themes containing CB]

CB is currently in a up trend. Over the last three months Buy-and-Hold has been a better strategy (returning -5.01%) for CB's investors than trading long signals.

Trend

CB has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 7 days, CB underperformed the SP500 index on 49% days. Which indicates that on days CB underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

CB returned losses on 58% days in the last three months. During this time, it delivered on average -0.07% per day. It delivered it's worst daily return of -4.24%, during this period, on Thursday, 11 Oct, 2018. There was initially a bullish trend during this period which started on 12 Sep, 2018 and went on till 19 Sep, 2018. The bullish trend returned +4.01% to investors. This was followed by a bearish trend that started on 29 Nov, 2018 and ended on 11 Dec, 2018. This bearish trend lost -5.54% of investor capital.

On monthly basis, CB delivered losses in more months over the last year, than profits. CB delivered profits less regularly than SP500 index. CB significantly outperformed SP500 index in Jul 2018, when it returned +10.18% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. CB had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Aug 2018 to Oct 2018) during which period it delivered -10.59%. It is interesting to note that both CB and SP500 index significantly outperform during months when quarterly/annual results are announced.

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CB 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 CB's volatility from 17 Sep, 2018 to 25 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 14 Sep, 2018 to 29 Oct, 2018.

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

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

Based on your interest in CB you may find it interesting to know that AEP has delivered similar performance as CB and can be considered as an alternative investment candidate (to CB).

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