LBTYA is a falling knife, continues to bleed every investor trying to catch it
11 Dec, 201813 min read
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LBTYA was among the worst performers today. On a longer term basis, investors in LIBERTY GLOBAL PLC made +0.03% per day. Tuesday's performance of -0.08% was a significant underperformance compared to it's daily average.
Buy-and-Hold investors in LBTYA experienced a maximum drawdown of -22.67% over the last three months. It lost -14.17% during this strong down 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 +2.27%.
LBTYA has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 7 days, LBTYA underperformed the SP500 index on 51% days.
LBTYA returned losses on 59% days in the last three months. During this time, it delivered on average -0.22% per day. It delivered it's worst daily return of -6.2%, during this period, on Wednesday, 24 Oct, 2018. There was initially a bullish trend during this period which started on 18 Sep, 2018 and went on till 21 Sep, 2018. The bullish trend returned +4.69% to investors. This was followed by a bearish trend that started on 30 Nov, 2018 and ended on 11 Dec, 2018. This bearish trend lost -5.32% of investor capital.
LBTYA had 4 profitable and 8 loss making months over the last year. During the last year, LBTYA underperformed SP500 index on monthly return basis. LBTYA was also a more risky investment than SP500 index as it's worst month in the last year, Feb 2018, returned -16.69% compared to -7.28% returned by SP500 index in Oct 2018. LBTYA had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Apr 2018 to Jun 2018) during which period it delivered -11.52%. It is interesting to note that both LBTYA and SP500 index significantly outperform during months when quarterly/annual results are announced.
I'd like to live as a poor man with lots of money.
-- Pablo Picasso
LBTYA 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 LBTYA's volatility from 28 Sep, 2018 to 21 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 14 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that LBTYA has positive skewness in it's return distribution. This indicates that investors can expect LBTYA to make attempts to recover from drawdowns quickly. Which makes LBTYA a good candidate for momentum based trading on short-term bullish trends or counter-trends.
SP500 index has more chance of extreme outcomes than LBTYA. Therefore, SP500 must receive a lower allocation than LBTYA in your portfolio. SP500 index usually has shorter drawdown period than LBTYA.
Based on your interest in LBTYA you may find it interesting to know that NFEC and PRQR have both shown remarkable performance this year and deserve to be on every investors' watchlist.
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