CONTINENTAL RESOURCES, INC

45.77 -1.11 (-2.43%) Sell

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

13 min read

CONTINENTAL RESOURCES, INC significantly underperformed today. It lost -2.43% to close at 45.77. During the last week it grew by +0.33% and saw a maximum drawdown of -2.43% before bouncing back.

[Themes containing CLR]

CLR is currently in a down trend. Over the last three months 2 bearish signals have generated a profit of +10.9% for investors.

Trend

CLR has been underperforming the SP500 index in recent time, after having outperformed till 3 Oct, 2018. Over the last 2 years 11 months and 10 days, CLR outperformed the SP500 index on 51% days.

During the last three months CLR was mostly loss making and delivered on average -0.39% per day. It's best return during this period (of +7.59%) was on Monday, 3 Dec, 2018. While it's worst loss in the same period (of -6.42%) was on Wednesday, 10 Oct, 2018. There was initially a bullish trend during this period which started on 27 Sep, 2018 and went on till 3 Oct, 2018. The bullish trend returned +7.25% to investors. This was followed by a bearish trend that started on 4 Oct, 2018 and ended on 11 Oct, 2018. This bearish trend lost -19.03% of investor capital.

CLR had 8 profitable and 4 loss making months over the last year. During the last year, number of profitable months of CLR and SP500 index were the same. CLR was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -25.19% compared to -7.28% returned by SP500 index in Oct 2018. CLR 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 CLR and SP500 index significantly outperform during months when quarterly/annual results are announced.

The stock market is a discounter of all known information.
-- Kenneth Fisher

CLR is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in CLR's volatility from 17 Sep, 2018 to 2 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 CLR 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.

Investors trading in CLR derivatives at this moment can consider 'Long Straddle' options strategy to receive better risk-adjusted returns.

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

On a general note (since you are interested in CLR), two large cap instruments that deserve special mention are MSFT and AMZN. They have significantly outperformed the overall market.

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