EVEREST RE GROUP LTD

217.78 +2.5 (+1.15%) Buy

Don't exit RE now, it performed well

13 min read

EVEREST RE GROUP LTD delivered good returns today. It grew by +1.15% to close at 217.78. It's recent 5 day performance has been -1.11%, -1.04%, -1.2%, -3.25% and +0.57%.

[Themes containing RE]

RE showed a down trend over the last 3 months. During this period RE lost -3.52% and saw a maximum drawdown of -12.05%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in RE till volatility reduces and a clear trend emerges.

Trend

RE has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 10 days, RE underperformed the SP500 index on 49% days. Which indicates that on days RE underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months RE delivered profits on 53% days. However, it still managed to end this period in a loss. It's best return during this period (of +6.31%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -4.77%) was on Wednesday, 10 Oct, 2018. There was initially a bullish trend during this period which started on 18 Sep, 2018 and went on till 21 Sep, 2018. The bullish trend returned +3.25% to investors. This was followed by a bearish trend that started on 19 Nov, 2018 and ended on 23 Nov, 2018. This bearish trend lost -1.01% of investor capital.

RE had 7 profitable and 5 loss making months over the last year. During the last year, RE underperformed SP500 index on monthly return basis. RE was also a more risky investment than SP500 index as it's worst month in the last year, Apr 2018, returned -8.55% compared to -7.28% returned by SP500 index in Oct 2018. RE had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year.

Money is multiplied in practical value depending on the number of W's you control in your life: what you do, when you do it, where you do it, and with whom you do it.
-- Timothy Ferriss

RE 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 RE's volatility from 20 Sep, 2018 to 2 Nov, 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 RE 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 RE. Therefore, SP500 must receive a lower allocation than RE in your portfolio. SP500 index usually has shorter drawdown period than RE.

Based on your interest in RE you may find it interesting to know that NFEC has shown remarkable performance this year and deserves to be on every investors' watchlist.

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