14.83 -0.1 (-0.67%) Sell

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

13 min read

MANULIFE FINANCIAL CORP (Foreign) has destroyed investor wealth today. It returned -0.67% to close at 14.83. It's recent 5 day performance has been -1.78%, -1.94%, -3.97%, -3.12% and +0.91%.

[Themes containing MFC]

MFC showed a strong down trend over the last 3 months. During this period MFC returned -15.06% and saw a maximum drawdown of -20.23%. There were 2 short signals during this period that returned a cumulative of +7.07% to investors.


MFC has been underperforming the SP500 index in recent time, after having outperformed till 9 Nov, 2017. Over the last 2 years 11 months and 7 days, MFC underperformed the SP500 index on 52% days.

During the last three months MFC was mostly loss making and delivered on average -0.24% per day. It's best return during this period (of +5.88%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -5.07%) was on Wednesday, 10 Oct, 2018. There was initially a bullish trend during this period which started on 12 Sep, 2018 and went on till 14 Sep, 2018. The bullish trend returned +1.37% to investors. This was followed by a bearish trend that started on 4 Dec, 2018 and ended on 11 Dec, 2018. This bearish trend lost -11.48% of investor capital.

On monthly basis, MFC delivered losses in more months over the last year, than profits. MFC delivered profits less regularly than SP500 index. MFC was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -12.72% compared to -7.28% returned by SP500 index in Oct 2018. MFC had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Aug 2018 to Oct 2018) during which period it delivered -16.42%. It is interesting to note that both MFC and SP500 index significantly outperform during months when quarterly/annual results are announced.

"The most popular investing products are the worst ones for investors.

MFC 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 MFC's volatility from 14 Sep, 2018 to 10 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 14 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that MFC has significant positive skewness in it's return distribution. This indicates that investors can expect MFC to recover from drawdowns quickly. Which makes MFC 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 MFC. Therefore, SP500 must receive a lower allocation than MFC in your portfolio. SP500 index usually has shorter drawdown period than MFC.

Based on your interest in MFC you may find it interesting to know that MTSC and EV have both performed similar to MFC and can be considered by investors as alternative investment options.

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