44.28 -0.34 (-0.76%) Sell

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

13 min read

CIT GROUP INC was among the worst performers today. It delivered -0.76% to close at 44.28. It's recent 5 day performance has been -0.36%, -4.82%, +1.34%, +0.3% and 0.0%.

[Themes containing CIT]

CIT showed a strong bearish trend over the last 3 months. During this period CIT delivered -18.24% and saw a maximum drawdown of -19.4%. There were 2 short signals during this period that returned a cumulative of +14.56% to investors.


CIT has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 27 Jun, 2016 to 3 Jul, 2017. Over the last 2 years 11 months and 3 days, CIT underperformed the SP500 index on 50% days. Which indicates that on days CIT underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months CIT was mostly loss making and delivered on average -0.31% per day. It's best return during this period (of +3.01%) was on Monday, 26 Nov, 2018. While it's worst loss in the same period (of -4.82%) was on Tuesday, 4 Dec, 2018. The longest stort-term trend during this period was 8 losing days, which started on 21 Sep, 2018 and ended on 2 Oct, 2018. This bearish trend lost -6.45% of investor capital.

The last 12 months saw CIT's investors making profits in 6 months and incurring losses in 6 months. CIT was less consistent in delivering monthly returs than SP500 index. CIT was also a less risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -7.17% compared to -7.28% returned by SP500 index in Oct 2018. CIT 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 -18.66%. It is interesting to note that both CIT and SP500 index significantly outperform during months when quarterly/annual results are announced.

"Based on my own personal experience - both as an investor in recent years and an expert witness in years past - rarely do more than three or four variables really count. Everything else is noise.

CIT 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 CIT's volatility from 10 Sep, 2018 to 25 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 10 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that CIT 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 CIT. Therefore, SP500 must receive a lower allocation than CIT in your portfolio. SP500 index usually has shorter drawdown period than CIT.

Based on your interest in CIT you may find it interesting to know that AMRN has shown remarkable performance this year and deserves to be on every investors' watchlist.

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