EXPEDIA GROUP, INC.

118.36 -1.22 (-1.03%) Sell

EXPE is a falling knife, continues to bleed every investor trying to catch it

13 min read

EXPEDIA GROUP, INC. delivered massive losses on Friday. It returned -1.03% to close at 118.36. On a day when the overall market breadth was 35%, it closed higher than 14% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing EXPE]

Buy-and-Hold investors in EXPE experienced a maximum drawdown of -16.97% over the last three months. It returned -8.23% during this down trending period. There were no long signals during this period, where the short signal generated good profits of +8.23% for investors.

Trend

EXPE has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 10 days, EXPE underperformed the SP500 index on 47% days. Which indicates that on days EXPE underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months EXPE was mostly loss making and delivered on average -0.12% per day. It's best return during this period (of +3.04%) was on Monday, 26 Nov, 2018. While it's worst loss in the same period (of -3.79%) was on Wednesday, 10 Oct, 2018. There was initially a bearish trend during this period which started on 4 Oct, 2018 and went on till 11 Oct, 2018. The trend delivered -11.04% losses to investors. This was followed by a bullish trend that started on 25 Oct, 2018 and ended on 1 Nov, 2018. This bullish trend delivered +11.22% to investors.

On monthly basis, EXPE delivered losses in more months over the last year, than profits. EXPE delivered profits less regularly than SP500 index. EXPE was also a more risky investment than SP500 index as it's worst month in the last year, Feb 2018, returned -17.84% compared to -7.28% returned by SP500 index in Oct 2018. EXPE had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Aug 2018 to Dec 2018) during which period it delivered -11.98%. It is interesting to note that both EXPE and SP500 index significantly outperform during months when quarterly/annual results are announced.

I hate weekends because there is no stock market.
-- Rene Rivkin

EXPE 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 EXPE's volatility from 2 Oct, 2018 to 30 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 EXPE has significant positive skewness in it's return distribution. This indicates that investors can expect EXPE to recover from drawdowns quickly. Which makes EXPE a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

Investors trading in EXPE derivatives at this moment can consider 'Long Straddle' options strategy to receive better risk-adjusted returns.

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

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

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