OVERSTOCK.COM, INC was among the worst performers today. It fell by -4.23% to close at 17.22. During the last week it fell by -8.7% and saw a maximum drawdown of -9.84% before bouncing back.
Buy-and-Hold investors in OSTK experienced a maximum drawdown of -40.5% over the last three months. It fell by -33.0% during this strong bearish trending period. There were no long signals during this period, where the short signal generated good profits of +33.0% for investors.
OSTK has been underperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 3 Feb, 2016 to 8 Jan, 2018. Over the last 2 years 11 months and 10 days, OSTK outperformed the SP500 index on 50% days. Which indicates that on days OSTK outperforms the SP500 index, it's performance is marginally better than on the days it underperforms the SP500 index.
OSTK was profitable on 52% days in the last three months. During this time, it delivered on average -0.47% per day. It delivered it's best daily return of +23.26%, during this period, on Friday, 23 Nov, 2018. The longest stort-term trend during this period was 5 profitable days, which started on 17 Sep, 2018 and went on till 21 Sep, 2018. This bullish trend returned +5.35% to investors.
During the last year OSTK had 4 profitable months and 8 loss making months. OSTK returned profits in fewer months than SP500 index. OSTK was also a more risky investment than SP500 index as it's worst month in the last year, Mar 2018, returned -39.98% compared to -7.28% returned by SP500 index in Oct 2018. OSTK had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Aug 2018 to Dec 2018) during which period it delivered -67.05%. It is interesting to note that both OSTK and SP500 index significantly outperform during months when quarterly/annual results are announced.
Investing is a business, investment is a project and investor is a promoter.
-- Vijay Kedia
OSTK is currently seeing overall increase in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant fall in OSTK's volatility from 17 Sep, 2018 to 26 Sep, 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 OSTK 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.
Investors trading in OSTK derivatives at this moment can consider 'Protective Collar' options strategy to receive better risk-adjusted returns.
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