67.53 +0.67 (+0.99%) Buy

Are you evaluating investing in ESE? Consider as it managed to marginally outperform the broader market

13 min read

ESCO TECHNOLOGIES INC managed to marginally outperform the broader market on Wednesday. It gained +0.99% to close at 67.53. It is currently trading +22% above it's 52 week low of 55.3 and is down only -3% from it's 52 week high.

[Themes containing ESE]

ESE showed a up trend over the last 3 months. During this period ESE gained +1.7% and saw a maximum drawdown of -11.61%. There was a long signal during this period which returned +3.72%.


ESE has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 8 days, ESE outperformed the SP500 index on 54% days.

ESE returned losses on 54% days in the last three months. During this time, it delivered on average +0.04% per day. It delivered it's best daily return of +7.49%, during this period, on Friday, 16 Nov, 2018. There was initially a bullish trend during this period which started on 13 Sep, 2018 and went on till 17 Sep, 2018. The bullish trend returned +1.05% 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 -9.54% of investor capital.

ESE had 7 profitable and 5 loss making months over the last year. During the last year, ESE underperformed SP500 index on monthly return basis. ESE significantly outperformed SP500 index in Nov 2018, when it returned +14.8% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ESE had a shorter streak of profitable months than SP500 index. It only went up in 5 straight months during the last year.

It's good to have money and the things that money can buy, but It's good, too, to check up once in a while and make sure that you haven't lost the things that money can't buy.
-- George Lorimer

ESE 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 ESE's volatility from 18 Sep, 2018 to 16 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 13 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that ESE has significant positive skewness in it's return distribution. This indicates that investors can expect ESE to recover from drawdowns quickly. Which makes ESE 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 ESE. Therefore, SP500 must receive a lower allocation than ESE in your portfolio. SP500 index usually has shorter drawdown period than ESE.

On a general note (since you are interested in ESE), if you are evaluating ESE as an investment candidate, then you should read about LBAI which has delivered similar performance and can help diversify your portfolio.

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