HARLEY DAVIDSON INC

34.72 -0.21 (-0.6%) Sell

HOG investors hurt by serious losses

13 min read

HARLEY DAVIDSON INC has destroyed investor wealth on Friday. It fell by -0.6% to close at 34.72. On a day when the overall market breadth was 35%, it closed higher than 68% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing HOG]

Buy-and-Hold investors in HOG experienced a maximum drawdown of -23.94% over the last three months. It fell by -21.75% during this strong bearish trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals. The net profit from Short signals was +13.93%.

Trend

HOG has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 1 Dec, 2016 to 13 Dec, 2018. Over the last 2 years 11 months and 10 days, HOG underperformed the SP500 index on 48% days. Which indicates that on days HOG underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months HOG was mostly loss making and delivered on average -0.37% per day. It's best return during this period (of +3.79%) was on Monday, 26 Nov, 2018. While it's worst loss in the same period (of -5.76%) was on Thursday, 6 Dec, 2018. The longest stort-term trend during this period was 8 losing days, which started on 4 Dec, 2018 and ended on 14 Dec, 2018. This bearish trend lost -21.89% of investor capital.

During the last year HOG had 4 profitable months and 8 loss making months. HOG returned profits in fewer months than SP500 index. HOG was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -17.9% compared to -7.28% returned by SP500 index in Oct 2018. HOG had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Jan 2018 to May 2018) during which period it delivered -21.1%.

Glamour is what I sell, it's my stock in trade.
-- Marlene Dietrich

HOG 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 HOG's volatility from 2 Oct, 2018 to 11 Dec, 2018. While there was a significant surge in the SP500 index's volatility from 25 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that HOG 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.

Investors trading in HOG 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 HOG. Therefore, SP500 must receive a lower allocation than HOG in your portfolio. SP500 index usually has shorter drawdown period than HOG.

Based on your interest in HOG you may find it interesting to know that MSFT and AMZN are both large caps that have shown remarkable performance and deserve to be on every investors' watchlist.

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