1.91 -0.14 (-7.28%) Sell

PES is a falling knife, continues to bleed every investor trying to catch it

13 min read

PIONEER ENERGY SERVICES CORP has destroyed investor wealth on Thursday. It lost -7.28% to close at 1.91. On a day when the overall market breadth was 35%, it closed higher than 86% of the market. In comparison, the benchmark SP500 index closed today at -0.0002%.

[Themes containing PES]

Buy-and-Hold investors in PES experienced a maximum drawdown of -44.64% over the last three months. It lost -37.38% during this strong down trending period. There were no long signals during this period, where the short signal generated good profits of +37.38% for investors.


PES has been underperforming the SP500 index in recent time, after having outperformed till 5 Jan, 2017. Over the last 2 years 11 months and 9 days, PES underperformed the SP500 index on 51% days.

During the last three months PES was mostly loss making and delivered on average -0.58% per day. It's best return during this period (of +32.14%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -10.86%) was on Tuesday, 4 Dec, 2018. There was initially a bullish trend during this period which started on 17 Sep, 2018 and went on till 24 Sep, 2018. The bullish trend returned +12.49% to investors. This was followed by a bearish trend that started on 4 Dec, 2018 and ended on 13 Dec, 2018. This bearish trend lost -32.17% of investor capital.

PES had 4 profitable and 8 loss making months over the last year. During the last year, PES underperformed SP500 index on monthly return basis. PES significantly outperformed SP500 index in May 2018, when it returned +59.42% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. PES had a longer winning streak of losing months than SP500 index. It went down in 6 straight months (from Jul 2018 to Dec 2018) during which period it delivered -89.88%. It is interesting to note that both PES and SP500 index significantly outperform during months when quarterly/annual results are announced.

Be quick in cutting your loses but not profits
-- Abhishek Shukla

PES 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 PES's volatility from 25 Sep, 2018 to 3 Oct, 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 PES 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 PES. Therefore, SP500 must receive a lower allocation than PES in your portfolio. SP500 index usually has shorter drawdown period than PES.

Based on your interest in PES you may find it interesting to know that AMRH and APRN have both shown remarkable performance and deserve to be on every investors' watchlist.

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