45.79 -1.62 (-3.54%) Sell

Don't buy GMED now, it is a really dangerous investment now

13 min read

GLOBUS MEDICAL INC significantly underperformed today. It delivered -3.54% to close at 45.79. It's recent 5 day performance has been +3.08%, -5.64%, +1.06%, +0.79% and -1.52%.

[Themes containing GMED]

GMED showed a strong bearish trend over the last 3 months. During this period GMED delivered -13.88% and saw a maximum drawdown of -20.28%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in GMED till volatility reduces and a clear trend emerges.


GMED has been underperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 14 Nov, 2016 to 6 Jun, 2018. Over the last 2 years 11 months and 3 days, GMED outperformed the SP500 index on 54% days.

GMED was profitable on 52% days in the last three months. During this time, it delivered on average -0.21% per day. It delivered it's worst daily return of -9.71%, during this period, on Friday, 9 Nov, 2018. The longest stort-term trend during this period was 5 profitable days, which started on 29 Oct, 2018 and went on till 2 Nov, 2018. This bullish trend returned +4.77% to investors.

The last 12 months saw GMED's investors making profits in 8 months and incurring losses in 4 months. During the last year, GMED and SP500 index had the same number of profitable months. GMED was also a more risky investment than SP500 index as it's worst month in the last year, Jun 2018, returned -9.16% compared to -7.28% returned by SP500 index in Oct 2018. GMED had a shorter streak of profitable months than SP500 index. It only went up in 5 straight months during the last year. It is interesting to note that both GMED and SP500 index significantly outperform during months when quarterly/annual results are announced.

Financial security and independence are like a three-legged stool resting on savings, insurance and investments.
-- Brian Tracy

GMED 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 GMED's volatility from 10 Sep, 2018 to 12 Nov, 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 GMED has significant positive skewness in it's return distribution. This indicates that investors can expect GMED to recover from drawdowns quickly. Which makes GMED 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 GMED. Therefore, SP500 must receive a lower allocation than GMED in your portfolio. GMED usually has shorter drawdown period than the SP500 index.

Based on your interest in GMED you may find it interesting to know that AMRH and AYTU have both shown remarkable performance and deserve to be on every investors' watchlist.

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