Joy for GPC investors as it marginally outperforms

GENUINE PARTS CO showed marginal outperformance on Wednesday. It increased by +1.01% to close at 100.11. It is currently trading +15% above it's 52 week low of 86.52 and is down only -6% from it's 52 week high.

[Themes containing GPC]

Buy-and-Hold investors in GPC experienced a maximum drawdown of -7.02% over the last three months. It fell by -1.5% during this bearish trending period. There were both Long and Short signals during this period, where the short signals were marginally more profitable than the long signals.

Trend

Monthly Performance

Alpha (outperformance)

Heatmap

Volatility

Return distribution

GPC has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 8 Jul, 2016 to 14 Mar, 2018. Over the last 2 years 11 months and 8 days, GPC underperformed the SP500 index on 47% days. Which indicates that on days GPC underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months GPC was mostly loss making and delivered on average -0.02% per day. It's best return during this period (of +5.97%) was on Thursday, 18 Oct, 2018. While it's worst loss in the same period (of -2.12%) was on Thursday, 6 Dec, 2018. The longest stort-term trend during this period was 5 losing days, which started on 4 Dec, 2018 and ended on 11 Dec, 2018. This bearish trend lost -4.96% of investor capital.

During the last year GPC had 7 profitable months and 5 loss making months. GPC returned profits in fewer months than SP500 index. GPC was also a more risky investment than SP500 index as it's worst month in the last year, Feb 2018, returned -11.75% compared to -7.28% returned by SP500 index in Oct 2018. GPC 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 GPC and SP500 index significantly outperform during months when quarterly/annual results are announced.

Be quick in cutting your loses but not profits
-- Abhishek Shukla

GPC 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 GPC's volatility from 13 Sep, 2018 to 18 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 GPC has significant positive skewness in it's return distribution. This indicates that investors can expect GPC to recover from drawdowns quickly. Which makes GPC a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

Investors trading in GPC derivatives at this moment can consider 'Covered Call' options strategy to receive better risk-adjusted returns.

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

Based on your interest in GPC you may find it interesting to know that EPIX is highly volatile and investors investing in it must take extreme caution. Consider either reducing your exposure to EPIX or sufficiently diversifying your portfolio.