243.01 -29.84 (-12.28%) Sell

COO investors disappointed by market underperformance

13 min read

COOPER COMPANIES INC delivered massive losses on Friday. It returned -12.28% to close at 243.01. It is currently trading -13% below it's 52 week high of 281.66.

[Themes containing COO]

Buy-and-Hold investors in COO experienced a maximum drawdown of -13.72% over the last three months. It returned -6.53% during this down trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals.


COO has been underperforming the SP500 index in recent time, after having outperformed till 6 Dec, 2018. Over the last 2 years 11 months and 3 days, COO outperformed the SP500 index on 55% days.

COO was profitable on 61% days in the last three months. During this time, it delivered on average -0.08% per day. It delivered it's worst daily return of -12.28%, during this period, on Friday, 7 Dec, 2018. There was initially a bullish trend during this period which started on 18 Sep, 2018 and went on till 2 Oct, 2018. The bullish trend returned +7.3% to investors. This was followed by a bearish trend that started on 3 Oct, 2018 and ended on 10 Oct, 2018. This bearish trend lost -9.61% of investor capital.

On monthly basis, COO delivered profits and losses in equal number of months. COO delivered profits less regularly than SP500 index. COO was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -12.85% compared to -7.28% returned by SP500 index in Oct 2018. COO had a shorter streak of profitable months than SP500 index. It only went up in 2 straight months during the last year. It is interesting to note that both COO and SP500 index significantly outperform during months when quarterly/annual results are announced.

In order to succeed, your desire for success should be greater than your fear of failure.
-- Bill Cosby

COO 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 COO's volatility from 2 Oct, 2018 to 7 Dec, 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 COO has significant positive skewness in it's return distribution. This indicates that investors can expect COO to recover from drawdowns quickly. Which makes COO a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

On a general note (since you are interested in COO), SQ is a mid cap that deserves to be closely tracked for investment opportunities.

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