79.31 -0.46 (-0.58%) Buy

Search for alternative investments is on for NHI investors as it shows weakness

13 min read

NATIONAL HEALTH INVESTORS INC has destroyed investor wealth on Friday. It returned -0.58% to close at 79.31. It is currently trading +25% above it's 52 week low of 63.33 and is down only -1% from it's 52 week high.

[Themes containing NHI]

Buy-and-Hold investors in NHI experienced a maximum drawdown of -8.99% over the last three months. It gained +2.24% during this up trending period. There were both Long and Short signals during this period, while the long signals were significantly more profitable than the short signals. The net profit from Long signals was +6.79%.


NHI has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 10 days, NHI outperformed the SP500 index on 52% days.

NHI was profitable on 55% days in the last three months. During this time, it delivered on average +0.04% per day. It delivered it's best daily return of +3.33%, during this period, on Thursday, 6 Dec, 2018. There was initially a bearish trend during this period which started on 1 Oct, 2018 and went on till 4 Oct, 2018. The trend delivered -4.52% losses to investors. This was followed by a bullish trend that started on 16 Nov, 2018 and ended on 23 Nov, 2018. This bullish trend delivered +1.44% to investors.

On monthly basis, NHI delivered profits in more months over the last year, than losses. NHI delivered profits less regularly than SP500 index. NHI significantly outperformed SP500 index in May 2018, when it returned +8.13% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. NHI had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year.

I believe in capitalism for everybody, not necessarily high finance but capitalism that works for the working men and women of this country who are out there paddling alone in America right now.
-- Rick Santorum

NHI is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in NHI's volatility from 17 Sep, 2018 to 6 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 NHI has significant positive skewness in it's return distribution. This indicates that investors can expect NHI to recover from drawdowns quickly. Which makes NHI a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

On a general note (since you are interested in NHI), three instruments that are extremely volatile are GNK, IX and OPNT. They must all be evaluated prudently and investors are better off avoiding them at the moment.

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