MERCADOLIBRE INC

326.52 -6.84 (-2.1%) Buy

Waiting to invest in MELI? Look for alternatives because it ranked worse than it's peers

13 min read

MERCADOLIBRE INC ranked among the worst performers today. It delivered -2.1% to close at 326.52. It's recent 5 day performance has been -7.71%, +1.72%, +0.49%, +2.01% and -1.14%.

[Themes containing MELI]

MELI showed a bullish trend over the last 3 months. During this period MELI delivered +1.32% and saw a maximum drawdown of -18.85%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in MELI till volatility reduces and a clear trend emerges.

Trend

MELI has been underperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 8 Feb, 2016 to 9 Mar, 2018. Over the last 2 years 11 months and 10 days, MELI outperformed the SP500 index on 53% days.

During the last three months MELI was mostly profitable and delivered on average +0.08% per day. It's best return during this period (of +8.03%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -7.71%) was on Thursday, 13 Dec, 2018. The longest stort-term trend during this period was 5 profitable days, which started on 30 Oct, 2018 and went on till 5 Nov, 2018. This bullish trend returned +22.5% to investors.

The last 12 months saw MELI's investors making profits in 5 months and incurring losses in 7 months. MELI was less consistent in delivering monthly returs than SP500 index. MELI significantly outperformed SP500 index in Jan 2018, when it returned +20.0% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. MELI had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Mar 2018 to May 2018) during which period it delivered -24.69%. It is interesting to note that both MELI and SP500 index significantly outperform during months when quarterly/annual results are announced.

"We need real campaign finance reform to loosen the grip of special interests on politics.

MELI 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 MELI's volatility from 21 Sep, 2018 to 30 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 MELI has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

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

Based on your interest in MELI you may find it interesting to know that AMD and LULU are both mid caps that have shown remarkable performance and deserve to be on every investors' watchlist.

Want to improve your Portfolio's performance?

Spotalpha's Portfolio optimizer is all you need to improve your returns and reduce your risk.
Optimize Portfolio NOW
Following
Symbol Price {{retType}} | Tr.
{{detail.symbol}} {{detail.close}} {{detail.priceChange}}  {{detail.pctChange}}%  {{detail.name}} {{detail.trend}} 
 
If you liked what you read here ...

... we have a small favour to ask. Help us bring the power of algorithmic trading strategies to individual investors.

All content in this article was automatically generated by algorithms. This ensures that there are no human biases in the analysis provided. This approach to investing is not new and has been around for more than three decades. Yet, it has been available to only the most affluent or elite investors leaving individual investors to trade on emotions (such as fear and greed), intuition and poor analysis from third-parties. We want to change this.

We want to empower investors with all the tools and analysis required by them to make a rational investment decision.

If you found Spotalpha useful, consider making a contribution. For as little as $5 you can support our efforts and it takes less than a minute. Thank you. Contribute
Share with friends   WhatsApp   Facebook   Twitter