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%.
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.
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.
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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.
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