30.15 -0.38 (-1.24%) Sell

FBC investors looking to preserve capital

13 min read

FLAGSTAR BANCORP INC was among the worst performers today. It returned -1.24% to close at 30.15. During the last week it returned -7.09% and saw a maximum drawdown of -7.09%.

[Themes containing FBC]

FBC is currently in a down trend. Over the last three months 2 bearish signals have generated a profit of +8.48% for investors.


FBC has been underperforming the SP500 index in recent time, after having outperformed till 26 Oct, 2017. Over the last 2 years 11 months and 3 days, FBC outperformed the SP500 index on 49% days. Which indicates that on days FBC outperforms the SP500 index, it's performance is marginally better than on the days it underperforms the SP500 index.

During the last three months FBC was mostly loss making and delivered on average -0.11% per day. It's best return during this period (of +5.1%) was on Friday, 19 Oct, 2018. While it's worst loss in the same period (of -5.03%) was on Thursday, 11 Oct, 2018. There was initially a bullish trend during this period which started on 17 Sep, 2018 and went on till 20 Sep, 2018. The bullish trend returned +4.47% to investors. This was followed by a bearish trend that started on 9 Oct, 2018 and ended on 12 Oct, 2018. This bearish trend lost -6.16% of investor capital.

On monthly basis, FBC delivered losses in more months over the last year, than profits. FBC delivered profits less regularly than SP500 index. FBC was also a less risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -7.09% compared to -7.28% returned by SP500 index in Oct 2018. FBC 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 -11.23%. It is interesting to note that both FBC and SP500 index significantly outperform during months when quarterly/annual results are announced.

"Hats have been my thing pretty much my whole life but finance has not. I would go to the corner store and buy really cheap baseball style caps and wear those to school.

FBC 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 FBC's volatility from 11 Sep, 2018 to 25 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 10 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that FBC has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

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

On a general note (since you are interested in FBC), three instruments that are extremely volatile are VIPS, ICPT and NVCN. They must all be evaluated prudently and investors are better off avoiding them at the moment.

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