56.45 -3.36 (-5.95%) Sell

MGPI investors dump it for better alternatives

13 min read

MGP INGREDIENTS INC is a falling knife that can bleed you if you catch it today. It lost -5.95% to close at 56.45. It's recent 5 day performance has been +1.23%, -2.16%, -1.56%, -3.1% and -2.19%.

[Themes containing MGPI]

MGPI is currently in a down trend. The current bearish signal has generated a profit of +27.85% for investors in the last three months.


MGPI has been underperforming the SP500 index in recent time, after having outperformed till 20 Jun, 2018. Over the last 2 years 11 months and 9 days, MGPI outperformed the SP500 index on 53% days.

During the last three months MGPI was mostly loss making and delivered on average -0.5% per day. It's best return during this period (of +4.47%) was on Tuesday, 6 Nov, 2018. While it's worst loss in the same period (of -7.34%) was on Friday, 2 Nov, 2018. There was initially a bullish trend during this period which started on 25 Sep, 2018 and went on till 28 Sep, 2018. The bullish trend returned +1.31% to investors. This was followed by a bearish trend that started on 3 Dec, 2018 and ended on 11 Dec, 2018. This bearish trend lost -13.5% of investor capital.

MGPI had 5 profitable and 7 loss making months over the last year. During the last year, MGPI underperformed SP500 index on monthly return basis. MGPI was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -16.97% compared to -7.28% returned by SP500 index in Oct 2018. MGPI had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Oct 2018 to Dec 2018) during which period it delivered -27.68%. It is interesting to note that both MGPI and SP500 index significantly outperform during months when quarterly/annual results are announced.

Never spend your money before you have earned it.
-- Thomas Jefferson

MGPI 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 MGPI's volatility from 28 Sep, 2018 to 2 Nov, 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 MGPI 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 MGPI. Therefore, SP500 must receive a lower allocation than MGPI in your portfolio. SP500 index usually has shorter drawdown period than MGPI.

Based on your interest in MGPI you may find it interesting to know that AAXN and EHC are both small caps that have shown remarkable performance and deserve to be on every investors' watchlist.

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