OLLI investors treading cautiously as performance is muted
14 Dec, 201813 min read
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OLLIE'S BARGAIN OUTLET HOLDINGS, INC. performed worse than the broader market on Friday. It lost -0.32% to close at 66.4. It is currently trading -31% below it's 52 week high of 96.5.
OLLI is currently in a down trend. The current bearish signal has generated a profit of +19.48% for investors in the last three months.
OLLI has been underperforming the SP500 index in recent time, after having outperformed till 1 Oct, 2018. Over the last 2 years 11 months and 10 days, OLLI outperformed the SP500 index on 55% days.
During the last three months OLLI was mostly loss making and delivered on average -0.43% per day. It's best return during this period (of +4.57%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -17.19%) was on Thursday, 6 Dec, 2018. There was initially a bullish trend during this period which started on 24 Sep, 2018 and went on till 26 Sep, 2018. The bullish trend returned +2.2% 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 -29.4% of investor capital.
OLLI had 8 profitable and 4 loss making months over the last year. During the last year, number of profitable months of OLLI and SP500 index were the same. OLLI significantly outperformed SP500 index in Aug 2018, when it returned +25.32% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. OLLI and SP500 index, both had periods of 6 consecutive profitable months.
Stock market bubbles don't grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception.
-- George Soros
OLLI 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 OLLI's volatility from 1 Oct, 2018 to 7 Dec, 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 OLLI has significant positive skewness in it's return distribution. This indicates that investors can expect OLLI to recover from drawdowns quickly. Which makes OLLI 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 OLLI. Therefore, SP500 must receive a lower allocation than OLLI in your portfolio. SP500 index usually has shorter drawdown period than OLLI.
On a general note (since you are interested in OLLI), PRQR has performed really well this year and deserves to be closely tracked for investment opportunities.
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