31.97 -0.17 (-0.53%) Sell

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

13 min read

JOHNSON CONTROLS INTERNATIONAL PLC has destroyed investor wealth on Friday. It fell by -0.53% to close at 31.97. It is currently trading -22% below it's 52 week high of 41.43.

[Themes containing JCI]

JCI showed a strong bearish trend over the last 3 months. During this period JCI fell by -14.17% and saw a maximum drawdown of -16.3%. There were 2 short signals during this period that returned a cumulative of +5.66% to investors.


JCI has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 6 Sep, 2016 to 1 Oct, 2018. Over the last 2 years 11 months and 10 days, JCI underperformed the SP500 index on 50% days. Which indicates that on days JCI underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months JCI was mostly loss making and delivered on average -0.23% per day. It's best return during this period (of +4.29%) was on Thursday, 1 Nov, 2018. While it's worst loss in the same period (of -4.11%) was on Tuesday, 9 Oct, 2018. The longest stort-term trend during this period was 6 losing days, which started on 21 Sep, 2018 and ended on 28 Sep, 2018. This bearish trend lost -6.51% of investor capital.

During the last year JCI had 4 profitable months and 8 loss making months. JCI returned profits in fewer months than SP500 index. JCI significantly outperformed SP500 index in Jul 2018, when it returned +12.58% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. JCI had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Feb 2018 to Jun 2018) during which period it delivered -11.63%. It is interesting to note that both JCI and SP500 index significantly outperform during months when quarterly/annual results are announced.

I understand that finance can be very complex.
-- Kevin Harrington

JCI is currently seeing overall fall in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in JCI's volatility from 28 Sep, 2018 to 29 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 JCI has significant positive skewness in it's return distribution. This indicates that investors can expect JCI to recover from drawdowns quickly. Which makes JCI a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

Based on your interest in JCI you may find it interesting to know that CHA and TPRE have both performed similar to JCI and can be considered by investors as alternative investment options.

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