5.01 -0.22 (-4.39%) Sell

Don't even consider investing in CRK now, it is a risky investment

13 min read

COMSTOCK RESOURCES INC significantly underperformed on Monday. It returned -4.39% to close at 5.01. On a day when the overall market breadth was 34%, it closed higher than 71% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing CRK]

CRK showed a strong down trend over the last 3 months. During this period CRK returned -40.21% and saw a maximum drawdown of -45.19%. There was a short signal during this period which returned +40.21%.


CRK has been underperforming the SP500 index in recent time, after having outperformed till 27 Jan, 2017. Over the last 2 years 11 months and 10 days, CRK underperformed the SP500 index on 51% days.

During the last three months CRK delivered profits on 50% days. However, it still managed to end this period in a loss. It's best return during this period (of +7.64%) was on Monday, 1 Oct, 2018. While it's worst loss in the same period (of -13.82%) was on Friday, 14 Dec, 2018. There was initially a bullish trend during this period which started on 27 Nov, 2018 and went on till 3 Dec, 2018. The bullish trend returned +11.66% to investors. This was followed by a bearish trend that started on 10 Dec, 2018 and ended on 17 Dec, 2018. This bearish trend lost -40.64% of investor capital.

On monthly basis, CRK delivered profits and losses in equal number of months. CRK delivered profits less regularly than SP500 index. CRK significantly outperformed SP500 index in May 2018, when it returned +65.95% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. CRK 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 CRK and SP500 index significantly outperform during months when quarterly/annual results are announced.

Persist - don't take no for an answer. If you're happy to sit at your desk and not take any risk, you'll be sitting at your desk for the next 20 years.
-- David Rubenstein

CRK 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 fall in CRK's volatility from 19 Sep, 2018 to 25 Sep, 2018. While there was a significant surge in the SP500 index's volatility from 19 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that CRK has significant negative skewness in it's return distribution. This indicates that CRK is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in CRK you may find it interesting to know that AMRH, AYTU and NSPR have all shown remarkable performance and qualify to be on every investor's watchlist.

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