32.67 -0.48 (-1.48%) Buy

ITRN investors herd to book profits while the going is good

13 min read

ITURAN LOCATION & CONTROL LTD. (Foreign) is a falling knife that can bleed you if you catch it on Monday. It lost -1.48% to close at 32.67. On a day when the overall market breadth was 34%, it closed higher than 79% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing ITRN]

Buy-and-Hold investors in ITRN experienced a maximum drawdown of -11.47% over the last three months. It lost -1.15% during this down trending period. There were no short signals during this period. However, the long signal was not profitable and lost investors -1.15%.


ITRN has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 10 days, ITRN outperformed the SP500 index on 51% days.

During the last three months ITRN was mostly loss making and delivered on average -0.0% per day. It's best return during this period (of +4.31%) was on Wednesday, 12 Dec, 2018. While it's worst loss in the same period (of -4.39%) was on Monday, 19 Nov, 2018. There was initially a bullish trend during this period which started on 19 Sep, 2018 and went on till 27 Sep, 2018. The bullish trend returned +4.47% to investors. This was followed by a bearish trend that started on 3 Oct, 2018 and ended on 11 Oct, 2018. This bearish trend lost -6.65% of investor capital.

ITRN had 7 profitable and 5 loss making months over the last year. During the last year, ITRN underperformed SP500 index on monthly return basis. ITRN significantly outperformed SP500 index in Jul 2018, when it returned +10.73% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ITRN had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year. It is interesting to note that both ITRN and SP500 index significantly outperform during months when quarterly/annual results are announced.

Know what you own, and know why you own it.
-- Peter Lynch

ITRN 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 ITRN's volatility from 19 Sep, 2018 to 14 Dec, 2018. While there was a significant surge in the SP500 index's volatility from 19 Sep, 2018 to 29 Oct, 2018.

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

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

Based on your interest in ITRN you may find it interesting to know that AMRH, NSPR and AYTU have all shown remarkable performance and qualify to be on every investor's watchlist.

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