39.23 +0.15 (+0.38%) Buy

Don't profit book on FE now, it outperformed most of it's peers

13 min read

FIRSTENERGY CORP outperformed the broader market today. It increased by +0.38% to close at 39.23. It's recent 5 day performance has been +1.37%, -0.1%, +2.01%, +1.83% and -1.2%.

[Themes containing FE]

FE showed a bullish trend over the last 3 months. During this period FE increased by +2.88% and saw a maximum drawdown of -5.82%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in FE till volatility reduces and a clear trend emerges.


FE has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 10 Mar, 2016 to 19 Jan, 2018. Over the last 2 years 11 months and 3 days, FE underperformed the SP500 index on 48% days. Which indicates that on days FE underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months FE was mostly profitable and delivered on average +0.05% per day. It's best return during this period (of +2.26%) was on Friday, 5 Oct, 2018. While it's worst loss in the same period (of -3.11%) was on Friday, 26 Oct, 2018. The longest stort-term trend during this period was 6 profitable days, which started on 12 Oct, 2018 and went on till 19 Oct, 2018. This bullish trend returned +4.35% to investors.

During the last year FE had 9 profitable months and 3 loss making months. FE returned profits in more months than SP500 index. FE significantly outperformed SP500 index in Jan 2018, when it returned +6.75% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. FE had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.

"Under capitalism, man exploits man. Under communism, it's just the opposite.

FE is currently seeing overall increase in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in FE's volatility from 18 Sep, 2018 to 31 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 FE has significant positive skewness in it's return distribution. This indicates that investors can expect FE to recover from drawdowns quickly. Which makes FE 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 FE. Therefore, SP500 must receive a lower allocation than FE in your portfolio. SP500 index usually has shorter drawdown period than FE.

Based on your interest in FE you may find it interesting to know that EPIX and IMTE are highly volatile and therefore risky. Investors should consider limiting their exposure to these instruments (because of their volatile nature).

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