Looking to invest in RNR? Consider at the moment as it outperformed the broader market

RENAISSANCERE HOLDINGS LTD outperformed the broader market on Friday. It increased by +4.0% to close at 139.2. It is currently trading +19% above it's 52 week low of 116.61 and is down only 0% from it's 52 week high.

[Themes containing RNR]

RNR showed a strong bullish trend over the last 3 months. During this period RNR increased by +10.6% and saw a maximum drawdown of -14.06%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in RNR till volatility reduces and a clear trend emerges.

Trend

Monthly Performance

Alpha (outperformance)

Heatmap

Volatility

Return distribution

RNR has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 14 Mar, 2017 to 10 Jan, 2018. Over the last 2 years 11 months and 3 days, RNR underperformed the SP500 index on 49% days. Which indicates that on days RNR underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months RNR was mostly profitable and delivered on average +0.17% per day. It's best return during this period (of +4.89%) was on Tuesday, 2 Oct, 2018. While it's worst loss in the same period (of -4.84%) was on Wednesday, 31 Oct, 2018. The longest stort-term trends during this period were 6 profitable and losing days. The bullish trend (which returned +8.98%) started on 15 Nov, 2018 and went on till 23 Nov, 2018 while the bearish trend (which returned -5.89%) started on 8 Oct, 2018 and went on till 15 Oct, 2018.

During the last year RNR had 8 profitable months and 4 loss making months. Profitable number of months of RNR and SP500 index were the same. RNR was also a more risky investment than SP500 index as it's worst month in the last year, May 2018, returned -9.75% compared to -7.28% returned by SP500 index in Oct 2018. RNR had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year. It is interesting to note that both RNR and SP500 index significantly outperform during months when quarterly/annual results are announced.

Persist - don't take no for an answer. If you're happy to sit at your desk and not take any risk, you'll be sitting at your desk for the next 20 years.
-- David Rubenstein

RNR 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 surge in RNR's volatility from 26 Sep, 2018 to 1 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 10 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that RNR has significant positive skewness in it's return distribution. This indicates that investors can expect RNR to recover from drawdowns quickly. Which makes RNR 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 RNR. Therefore, SP500 must receive a lower allocation than RNR in your portfolio. SP500 index usually has shorter drawdown period than RNR.

Based on your interest in RNR you may find it interesting to know that IX and NVCN are highly volatile and therefore risky. Investors should consider limiting their exposure to these instruments (because of their volatile nature).