157.2 -1.92 (-1.22%) Sell

ROK investors dump it for better alternatives

13 min read

ROCKWELL AUTOMATION INC is a falling knife that can bleed you if you catch it on Thursday. It lost -1.22% to close at 157.2. It is currently trading -24% below it's 52 week high of 207.92.

[Themes containing ROK]

ROK is currently in a down trend. The current bearish signal has generated a profit of +5.44% for investors in the last three months.


ROK has been underperforming the SP500 index in recent time, after having outperformed till 31 Oct, 2017. Over the last 2 years 11 months and 9 days, ROK outperformed the SP500 index on 53% days.

During the last three months ROK was mostly loss making and delivered on average -0.3% per day. It's best return during this period (of +5.24%) was on Thursday, 1 Nov, 2018. While it's worst loss in the same period (of -4.04%) was on Wednesday, 24 Oct, 2018. There was initially a bullish trend during this period which started on 18 Sep, 2018 and went on till 20 Sep, 2018. The bullish trend returned +2.85% to investors. This was followed by a bearish trend that started on 4 Oct, 2018 and ended on 15 Oct, 2018. This bearish trend lost -11.52% of investor capital.

ROK had 4 profitable and 8 loss making months over the last year. During the last year, ROK underperformed SP500 index on monthly return basis. ROK was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -12.38% compared to -7.28% returned by SP500 index in Oct 2018. ROK had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from Jan 2018 to Apr 2018) during which period it delivered -14.83%. It is interesting to note that both ROK and SP500 index significantly outperform during months when quarterly/annual results are announced.

I understand that finance can be very complex.
-- Kevin Harrington

ROK 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 ROK's volatility from 17 Sep, 2018 to 11 Dec, 2018. While there was a significant surge in the SP500 index's volatility from 14 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that ROK 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 ROK. Therefore, SP500 must receive a lower allocation than ROK in your portfolio. SP500 index usually has shorter drawdown period than ROK.

Based on your interest in ROK you may find it interesting to know that CSCO and PFE are both large caps that have shown remarkable performance and deserve to be on every investors' watchlist.

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