EAST WEST BANCORP INC has destroyed investor wealth on Monday. It lost -0.83% to close at 44.23 which is it's 52 week low, down -39% from it's 52 week high.
Buy-and-Hold investors in EWBC experienced a maximum drawdown of -30.24% over the last three months. It lost -29.16% during this strong down trending period. There were no long signals during this period, where the short signal generated good profits of +29.16% for investors.
EWBC returned losses on 57% days in the last three months. During this time, it delivered on average -0.54% per day. It delivered it's worst daily return of -7.05%, during this period, on Tuesday, 4 Dec, 2018. There was initially a bearish trend during this period which started on 16 Oct, 2018 and went on till 22 Oct, 2018. The trend delivered -7.08% losses to investors. This was followed by a bullish trend that started on 1 Nov, 2018 and ended on 8 Nov, 2018. This bullish trend delivered +4.59% to investors.
EWBC had 4 profitable and 8 loss making months over the last year. During the last year, EWBC underperformed SP500 index on monthly return basis. EWBC was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -16.93% compared to -7.28% returned by SP500 index in Oct 2018. EWBC had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Jun 2018 to Oct 2018) during which period it delivered -27.91%. It is interesting to note that both EWBC and SP500 index significantly outperform during months when quarterly/annual results are announced.
To beat the market you'll have to invest serious bucks to dig up information no one else has yet.
-- Merton Miller
EWBC 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 EWBC's volatility from 28 Sep, 2018 to 11 Dec, 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 EWBC has significant positive skewness in it's return distribution. This indicates that investors can expect EWBC to recover from drawdowns quickly. Which makes EWBC a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.
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