43.01 -1.0 (-2.32%) Buy

LTC investors take a moment to reassess their portfolio allocation

13 min read

LTC PROPERTIES INC ranked among the worst performers today. It delivered -2.32% to close at 43.01. During the last week it delivered -3.93% and saw a maximum drawdown of -3.93%.

[Themes containing LTC]

Buy-and-Hold investors in LTC experienced a maximum drawdown of -8.2% over the last three months. It delivered -2.47% during this bearish trending period. There were both Long and Short signals during this period, where the short signals were marginally more profitable than the long signals.


LTC has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 5 Jul, 2016 to 23 Apr, 2018. Over the last 2 years 11 months and 10 days, LTC underperformed the SP500 index on 47% days. Which indicates that on days LTC underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months LTC delivered profits on 53% days. However, it still managed to end this period in a loss. It's best return during this period (of +5.8%) was on Tuesday, 6 Nov, 2018. While it's worst loss in the same period (of -3.84%) was on Thursday, 11 Oct, 2018. The longest stort-term trend during this period was 5 profitable days, which started on 27 Nov, 2018 and went on till 3 Dec, 2018. This bullish trend returned +5.1% to investors.

The last 12 months saw LTC's investors making profits in 5 months and incurring losses in 7 months. LTC was less consistent in delivering monthly returs than SP500 index. LTC significantly outperformed SP500 index in May 2018, when it returned +13.8% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. LTC had a shorter streak of profitable months than SP500 index. It only went up in 2 straight months during the last year.

Everyday is a bank account, and time is our currency. No one is rich, no one is poor, we've got 24 hours each.
-- Christopher Rice

LTC 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 LTC's volatility from 21 Sep, 2018 to 6 Nov, 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 LTC has significant positive skewness in it's return distribution. This indicates that investors can expect LTC to recover from drawdowns quickly. Which makes LTC a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

On a general note (since you are interested in LTC), two instruments that have delivered similar performance as LTC are GSBD and HRC. They are suitable as good alternative investment candidates that can diversify your portfolio.

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