23.67 -0.03 (-0.13%) Sell

Don't consider buying PFS now, it is risky at the moment

13 min read

PROVIDENT FINANCIAL SERVICES INC showed weakness today. It lost -0.13% to close at 23.67. It's recent 5 day performance has been -2.23%, +1.38%, +0.42%, -0.33% and 0.0%.

[Themes containing PFS]

PFS showed a down trend over the last 3 months. During this period PFS lost -5.28% and saw a maximum drawdown of -11.66%. There were 2 short signals during this period that returned a cumulative of +2.07% to investors.


PFS has been underperforming the SP500 index in recent time, after having outperformed till 27 Dec, 2016. Over the last 2 years 11 months and 10 days, PFS underperformed the SP500 index on 48% days. Which indicates that on days PFS underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months PFS delivered profits on 50% days. However, it still managed to end this period in a loss. It's best return during this period (of +5.1%) was on Friday, 26 Oct, 2018. While it's worst loss in the same period (of -6.18%) was on Tuesday, 4 Dec, 2018. There was initially a bullish trend during this period which started on 1 Nov, 2018 and went on till 8 Nov, 2018. The bullish trend returned +4.8% to investors. This was followed by a bearish trend that started on 16 Nov, 2018 and ended on 21 Nov, 2018. This bearish trend lost -1.48% of investor capital.

PFS had 5 profitable and 7 loss making months over the last year. During the last year, PFS underperformed SP500 index on monthly return basis. PFS was also a more risky investment than SP500 index as it's worst month in the last year, Jul 2018, returned -8.46% compared to -7.28% returned by SP500 index in Oct 2018. PFS had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from Jun 2018 to Sep 2018) during which period it delivered -13.84%. It is interesting to note that both PFS and SP500 index significantly outperform during months when quarterly/annual results are announced.

Everyone has the brainpower to follow the stock market. If you made it through fifth-grade math, you can do it .
-- Peter Lynch

PFS 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 PFS's volatility from 18 Sep, 2018 to 4 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 PFS 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.

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

On a general note (since you are interested in PFS), TWTR is a mid cap that deserves to be closely tracked for investment opportunities.

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