34.75 -0.18 (-0.52%) Sell

IBOC is a falling knife, continues to bleed every investor trying to catch it

13 min read

INTERNATIONAL BANCSHARES CORP is a falling knife that can bleed you if you catch it today. It delivered -0.52% to close at 34.75. During the last week it delivered -0.77% and saw a maximum drawdown of -1.89% before bouncing back.

[Themes containing IBOC]

Buy-and-Hold investors in IBOC experienced a maximum drawdown of -27.15% over the last three months. It delivered -25.67% 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 +22.24%.


IBOC has been underperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 7 Apr, 2016 to 20 Dec, 2016. Over the last 2 years 11 months and 10 days, IBOC outperformed the SP500 index on 51% days.

During the last three months IBOC was mostly loss making and delivered on average -0.46% per day. It's best return during this period (of +3.08%) was on Thursday, 25 Oct, 2018. While it's worst loss in the same period (of -5.77%) was on Tuesday, 4 Dec, 2018. The longest stort-term trend during this period was 6 profitable days, which started on 1 Nov, 2018 and went on till 8 Nov, 2018. This bullish trend returned +6.07% to investors.

The last 12 months saw IBOC's investors making profits in 6 months and incurring losses in 6 months. IBOC was less consistent in delivering monthly returs than SP500 index. IBOC was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -12.3% compared to -7.28% returned by SP500 index in Oct 2018. IBOC had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from Sep 2018 to Dec 2018) during which period it delivered -26.53%. It is interesting to note that both IBOC and SP500 index significantly outperform during months when quarterly/annual results are announced.

"You don't want to have so much money going toward your mortgage every month that you can't enjoy life or take care of your other financial responsibilities.

IBOC 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 IBOC's volatility from 18 Sep, 2018 to 16 Oct, 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 IBOC has significant positive skewness in it's return distribution. This indicates that investors can expect IBOC to recover from drawdowns quickly. Which makes IBOC a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

Based on your interest in IBOC you may find it interesting to know that I and HEAR have both shown remarkable performance this year and deserve to be on every investors' watchlist.

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