MOODYS CORP

145.78 -3.95 (-2.71%) Sell

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

13 min read

MCO was among the worst performers today. On a longer term basis, investors in MOODYS CORP made -0.06% per day. Friday's performance of -2.71% was a significant underperformance compared to it's daily average.

[Themes containing MCO]

MCO showed a strong down trend over the last 3 months. During this period MCO returned -17.71% and saw a maximum drawdown of -22.26%. There were 2 short signals during this period that returned a cumulative of +9.1% to investors.

Trend

MCO has been underperforming the SP500 index in recent time, after having outperformed till 23 Jul, 2018. Over the last 2 years 11 months and 3 days, MCO outperformed the SP500 index on 57% days.

MCO returned losses on 58% days in the last three months. During this time, it delivered on average -0.29% per day. It delivered it's worst daily return of -8.67%, during this period, on Friday, 26 Oct, 2018. There was initially a bullish trend during this period which started on 10 Sep, 2018 and went on till 14 Sep, 2018. The bullish trend returned +2.46% to investors. This was followed by a bearish trend that started on 2 Oct, 2018 and ended on 5 Oct, 2018. This bearish trend lost -4.91% of investor capital.

On monthly basis, MCO delivered profits in more months over the last year, than losses. MCO delivered profits less regularly than SP500 index. MCO was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -14.2% compared to -7.28% returned by SP500 index in Oct 2018. MCO had a shorter streak of profitable months than SP500 index. It only went up in 2 straight months during the last year.

"Infinite growth of material consumption in a finite world is an impossibility.

MCO 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 MCO's volatility from 13 Sep, 2018 to 29 Oct, 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 MCO has significant positive skewness in it's return distribution. This indicates that investors can expect MCO to recover from drawdowns quickly. Which makes MCO 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 MCO. Therefore, SP500 must receive a lower allocation than MCO in your portfolio. MCO usually has shorter drawdown period than the SP500 index.

On a general note (since you are interested in MCO), AMD is a mid cap that deserves to be closely tracked for investment opportunities.

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