Don't profit book on EXPO now, it performed well
11 Dec, 201813 min read
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EXPONENT INC ranked among the best performers today. It delivered +1.47% to close at 49.03. It's recent 5 day performance has been +0.23%, -0.99%, +1.33%, -4.42% and -0.1%.
EXPO showed a bearish trend over the last 3 months. During this period EXPO fell by -8.78% and saw a maximum drawdown of -13.17%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in EXPO till volatility reduces and a clear trend emerges.
EXPO has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 6 Jun, 2018 to 18 Oct, 2018. Over the last 2 years 11 months and 7 days, EXPO underperformed the SP500 index on 46% days. Which indicates that on days EXPO underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.
During the last three months EXPO was mostly loss making and delivered on average -0.13% per day. It's best return during this period (of +3.63%) was on Thursday, 25 Oct, 2018. While it's worst loss in the same period (of -4.42%) was on Tuesday, 4 Dec, 2018. The longest stort-term trend during this period was 5 profitable days, which started on 2 Nov, 2018 and went on till 8 Nov, 2018. This bullish trend returned +7.0% to investors.
During the last year EXPO had 7 profitable months and 5 loss making months. EXPO returned profits in fewer months than SP500 index. EXPO was also a more risky investment than SP500 index as it's worst month in the last year, Jun 2018, returned -50.86% compared to -7.28% returned by SP500 index in Oct 2018. EXPO had a shorter streak of profitable months than SP500 index. It only went up in 5 straight months during the last year.
Here's my gift-giving rule: Respect your current financial situation.
-- Suze Orman
EXPO is currently seeing overall fall in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in EXPO's volatility from 13 Sep, 2018 to 19 Oct, 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 EXPO has significant positive skewness in it's return distribution. This indicates that investors can expect EXPO to recover from drawdowns quickly. Which makes EXPO 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 EXPO. Therefore, SP500 must receive a lower allocation than EXPO in your portfolio. EXPO usually has shorter drawdown period than the SP500 index.
On a general note (since you are interested in EXPO), two mid cap instruments that deserve special mention are TWTR and AMD. They have significantly outperformed the overall market.
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