Are you evaluating investing in HBAN? Avoid as it ranked among the worst performers
11 Dec, 201813 min read
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HUNTINGTON BANCSHARES INC ranked among the worst performers on Tuesday. It lost -2.0% to close at 12.76. On a day when the overall market breadth was 35%, it closed higher than 8% of the market. In comparison, the benchmark SP500 index closed today at -0.0004%.
HBAN showed a strong down trend over the last 3 months. During this period HBAN lost -19.09% and saw a maximum drawdown of -20.15%. There were 3 short signals during this period that returned a cumulative of +12.66% to investors.
HBAN has been underperforming the SP500 index in recent time, after having outperformed till 1 Mar, 2017. Over the last 2 years 11 months and 7 days, HBAN underperformed the SP500 index on 48% days. Which indicates that on days HBAN underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.
During the last three months HBAN was mostly loss making and delivered on average -0.33% per day. It's best return during this period (of +3.27%) was on Thursday, 25 Oct, 2018. While it's worst loss in the same period (of -5.52%) was on Tuesday, 4 Dec, 2018. There was initially a bearish trend during this period which started on 21 Sep, 2018 and went on till 28 Sep, 2018. The trend delivered -6.81% losses to investors. This was followed by a bullish trend that started on 25 Oct, 2018 and ended on 1 Nov, 2018. This bullish trend delivered +8.97% to investors.
HBAN had 5 profitable and 7 loss making months over the last year. During the last year, HBAN underperformed SP500 index on monthly return basis. HBAN was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -12.54% compared to -7.28% returned by SP500 index in Oct 2018. HBAN had a shorter streak of profitable months than SP500 index. It only went up in 2 straight months during the last year. It is interesting to note that both HBAN and SP500 index significantly outperform during months when quarterly/annual results are announced.
Innovation distinguishes between a leader and a follower.
-- Steve Jobs
HBAN 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 HBAN's volatility from 25 Sep, 2018 to 25 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 HBAN has significant positive skewness in it's return distribution. This indicates that investors can expect HBAN to recover from drawdowns quickly. Which makes HBAN a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.
HBAN has more chance of extreme outcomes than the SP500 index. Therefore, HBAN must receive a lower allocation than SP500 in your portfolio. SP500 index usually has shorter drawdown period than HBAN.
Based on your interest in HBAN you may find it interesting to know that AMRN, NFEC and HEAR have all shown remarkable performance this year and deserve to be on every investor's watchlist.
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