33.03 +0.56 (+1.69%) Sell

Want to invest in LXFT? Consider as it managed to marginally outperform the broader market

13 min read

LUXOFT HOLDING, INC (Foreign) delivered stellar performance on Friday. It gained +1.69% to close at 33.03. On a day when the overall market breadth was 35%, it closed higher than 78% of the market. In comparison, the benchmark SP500 index closed today at -0.0233%.

[Themes containing LXFT]

LXFT showed a strong down trend over the last 3 months. During this period LXFT returned -28.97% and saw a maximum drawdown of -36.48%. There was a short signal during this period which returned +22.9%.


LXFT has been underperforming the SP500 index in recent time, after having outperformed till 2 Feb, 2016. Over the last 2 years 11 months and 3 days, LXFT underperformed the SP500 index on 48% days. Which indicates that on days LXFT underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

LXFT returned losses on 61% days in the last three months. During this time, it delivered on average -0.51% per day. It delivered it's worst daily return of -14.06%, during this period, on Thursday, 15 Nov, 2018. There was initially a bullish trend during this period which started on 14 Sep, 2018 and went on till 21 Sep, 2018. The bullish trend returned +9.49% to investors. This was followed by a bearish trend that started on 9 Nov, 2018 and ended on 20 Nov, 2018. This bearish trend lost -26.89% of investor capital.

On monthly basis, LXFT delivered profits in more months over the last year, than losses. LXFT delivered profits less regularly than SP500 index. LXFT was also a more risky investment than SP500 index as it's worst month in the last year, Feb 2018, returned -25.02% compared to -7.28% returned by SP500 index in Oct 2018. LXFT had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year. It is interesting to note that both LXFT and SP500 index significantly outperform during months when quarterly/annual results are announced.

"The financial markets generally are unpredictable. So that one has to have different scenarios... The idea that you can actually predict what's going to happen contradicts my way of looking at the market.

LXFT 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 LXFT's volatility from 18 Sep, 2018 to 15 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 10 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that LXFT has significant positive skewness in it's return distribution. This indicates that investors can expect LXFT to recover from drawdowns quickly. Which makes LXFT a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

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

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