35.85 -0.73 (-2.05%) Sell

Prayers for ROL investors as it delivered massive losses

13 min read

ROLLINS INC ranked among the worst performers on Monday. It delivered -2.05% to close at 35.85. On a day when the overall market breadth was 34%, it closed higher than 4% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing ROL]

Buy-and-Hold investors in ROL experienced a maximum drawdown of -16.19% over the last three months. It delivered -16.19% during this strong bearish trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals.


ROL has been underperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 5 Jan, 2016 to 29 Nov, 2018. Over the last 2 years 11 months and 10 days, ROL outperformed the SP500 index on 54% days.

During the last three months ROL was mostly loss making and delivered on average -0.27% per day. It's best return during this period (of +3.72%) was on Wednesday, 7 Nov, 2018. While it's worst loss in the same period (of -5.69%) was on Thursday, 6 Dec, 2018. The longest stort-term trends during this period were 4 profitable and losing days. The bullish trend (which returned +4.27%) started on 26 Oct, 2018 and went on till 31 Oct, 2018 while the bearish trend (which returned -2.98%) started on 19 Nov, 2018 and went on till 23 Nov, 2018.

The last 12 months saw ROL's investors making profits in 10 months and incurring losses in 2 months. During the last year, ROL delivered profits in more months than SP500 index. ROL was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -13.62% compared to -7.28% returned by SP500 index in Oct 2018. ROL had a longer winning streak of profitable months than SP500 index. It went up in 7 straight months (from May 2018 to Nov 2018) during which period it delivered +29.68%.

I don't really enjoy finance and accounting.
-- Holly Branson

ROL 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 ROL's volatility from 24 Sep, 2018 to 14 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 ROL has significant positive skewness in it's return distribution. This indicates that investors can expect ROL to recover from drawdowns quickly. Which makes ROL 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 ROL. Therefore, SP500 must receive a lower allocation than ROL in your portfolio. SP500 index usually has shorter drawdown period than ROL.

On a general note (since you are interested in ROL), three instruments that are extremely volatile are GNK, IX and IMTE. They must all be evaluated prudently and investors are better off avoiding them at the moment.

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