22.08 -0.68 (-3.07%) Buy

Are you evaluating investing in NWL? Wait as it delivered lacklustre performance

13 min read

NEWELL BRANDS INC is a falling knife that can bleed you if you catch it on Friday. It lost -3.07% to close at 22.08. On a day when the overall market breadth was 35%, it closed higher than 68% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing NWL]

NWL showed a up trend over the last 3 months. During this period NWL returned +2.41% and saw a maximum drawdown of -30.0%. There was a long signal during this period which returned +3.27%.


NWL has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 10 days, NWL underperformed the SP500 index on 49% days. Which indicates that on days NWL underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months NWL delivered losses on 53% days. However, it still managed to end this period in a profit. It's best return during this period (of +14.74%) was on Friday, 2 Nov, 2018. While it's worst loss in the same period (of -6.42%) was on Thursday, 18 Oct, 2018. There was initially a bearish trend during this period which started on 9 Oct, 2018 and went on till 15 Oct, 2018. The trend delivered -10.11% losses to investors. This was followed by a bullish trend that started on 12 Nov, 2018 and ended on 16 Nov, 2018. This bullish trend delivered +8.67% to investors.

NWL had 3 profitable and 9 loss making months over the last year. During the last year, NWL underperformed SP500 index on monthly return basis. NWL significantly outperformed SP500 index in Nov 2018, when it returned +47.36% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. NWL had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from Jul 2018 to Oct 2018) during which period it delivered -46.18%.

A successful man is one who can lay a firm foundation with the bricks others have thrown at him.
-- David Brinkley

NWL 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 NWL's volatility from 17 Sep, 2018 to 5 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 NWL has significant positive skewness in it's return distribution. This indicates that investors can expect NWL to recover from drawdowns quickly. Which makes NWL 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 NWL. Therefore, SP500 must receive a lower allocation than NWL in your portfolio. NWL usually has shorter drawdown period than the SP500 index.

On a general note (since you are interested in NWL), two instruments that deserve special mention are NIHD and I. They have significantly outperformed the overall market this year.

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