PPBI investors hold onto their investments as it marginally outperforms
11 Dec, 201813 min read
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PACIFIC PREMIER BANCORP INC delivered stellar performance on Tuesday. It gained +0.54% to close at 27.85. It is currently trading -38% below it's 52 week high of 45.1.
Buy-and-Hold investors in PPBI experienced a maximum drawdown of -31.96% over the last three months. It returned -27.38% during this strong down trending period. There were no long signals during this period, where the short signal generated good profits of +27.38% for investors.
PPBI has been underperforming the SP500 index in recent time, after having outperformed till 8 Mar, 2018. Over the last 2 years 11 months and 7 days, PPBI outperformed the SP500 index on 51% days.
PPBI returned losses on 60% days in the last three months. During this time, it delivered on average -0.48% per day. It delivered it's worst daily return of -10.8%, during this period, on Wednesday, 24 Oct, 2018. There was initially a bearish trend during this period which started on 18 Oct, 2018 and went on till 24 Oct, 2018. The trend delivered -24.94% losses to investors. This was followed by a bullish trend that started on 29 Oct, 2018 and ended on 2 Nov, 2018. This bullish trend delivered +11.69% to investors.
On monthly basis, PPBI delivered profits and losses in equal number of months. PPBI delivered profits less regularly than SP500 index. PPBI was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -19.72% compared to -7.28% returned by SP500 index in Oct 2018. PPBI had a shorter streak of profitable months than SP500 index. It only went up in 2 straight months during the last year.
"The way to become rich is to put all your eggs in one basket and then watch that basket.
PPBI 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 PPBI's volatility from 13 Sep, 2018 to 25 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 13 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that PPBI has significant positive skewness in it's return distribution. This indicates that investors can expect PPBI to recover from drawdowns quickly. Which makes PPBI 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 PPBI. Therefore, SP500 must receive a lower allocation than PPBI in your portfolio. SP500 index usually has shorter drawdown period than PPBI.
Based on your interest in PPBI you may find it interesting to know that ICPT and OPNT are highly volatile and therefore risky. Investors should consider limiting their exposure to these instruments (because of their volatile nature).
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