3.92 -0.42 (-10.71%) Buy

CYH investors take a moment to reassess their portfolio allocation

13 min read

CYH is a falling knife that can bleed you if you catch it today. On a longer term basis, investors in COMMUNITY HEALTH SYSTEMS INC made +0.26% per day. Friday's performance of -10.71% was a underperformance compared to it's daily average.

[Themes containing CYH]

Buy-and-Hold investors in CYH experienced a maximum drawdown of -27.02% over the last three months. It delivered +19.88% during this strong bullish trending period. There were both Long and Short signals during this period, while the long signals were significantly more profitable than the short signals. The net profit from Long signals was +12.42%.


CYH has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 4 Jan, 2016 to 3 Oct, 2018. Over the last 2 years 11 months and 10 days, CYH underperformed the SP500 index on 52% days.

During the last three months CYH was mostly profitable and delivered on average +0.41% per day. It's best return during this period (of +12.46%) was on Wednesday, 31 Oct, 2018. While it's worst loss in the same period (of -11.64%) was on Tuesday, 30 Oct, 2018. The longest stort-term trend during this period was 7 profitable days, which started on 15 Oct, 2018 and went on till 23 Oct, 2018. This bullish trend returned +13.14% to investors.

The last 12 months saw CYH's investors making profits in 5 months and incurring losses in 7 months. CYH was less consistent in delivering monthly returs than SP500 index. CYH significantly outperformed SP500 index in Nov 2018, when it returned +50.32% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. CYH had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Feb 2018 to Apr 2018) during which period it delivered -33.6%. It is interesting to note that both CYH and SP500 index significantly outperform during months when quarterly/annual results are announced.

Traditionally, the sample is always better than the stock you deliver to the store.
-- Calvin Klein

CYH 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 CYH's volatility from 17 Sep, 2018 to 2 Oct, 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 CYH has significant positive skewness in it's return distribution. This indicates that investors can expect CYH to recover from drawdowns quickly. Which makes CYH a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

Investors trading in CYH derivatives at this moment can consider 'Protective Collar' options strategy to receive better risk-adjusted returns.

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

Based on your interest in CYH you may find it interesting to know that CSCO is a large cap that has shown remarkable performance and deserves to be on every investors' watchlist.

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