J M SMUCKER CO

98.17 -2.59 (-2.64%) Sell

SJM investors incur serious losses

13 min read

J M SMUCKER CO was among the worst performers today. It delivered -2.64% to close at 98.17. During the last week it delivered -6.07% and saw a maximum drawdown of -6.07%.

[Themes containing SJM]

Buy-and-Hold investors in SJM experienced a maximum drawdown of -14.04% over the last three months. It delivered -10.89% 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. The net profit from Short signals was +5.3%.

Trend

SJM has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 7 Jul, 2016 to 3 Oct, 2018. Over the last 2 years 11 months and 3 days, SJM underperformed the SP500 index on 49% days. Which indicates that on days SJM underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months SJM delivered profits on 53% days. However, it still managed to end this period in a loss. It's best return during this period (of +2.23%) was on Monday, 29 Oct, 2018. While it's worst loss in the same period (of -7.24%) was on Wednesday, 28 Nov, 2018. The longest stort-term trend during this period was 6 profitable days, which started on 5 Nov, 2018 and went on till 12 Nov, 2018. This bullish trend returned +7.82% to investors.

The last 12 months saw SJM's investors making profits in 3 months and incurring losses in 9 months. SJM was less consistent in delivering monthly returs than SP500 index. SJM was also a less risky investment than SP500 index as it's worst month in the last year, Aug 2018, returned -6.97% compared to -7.28% returned by SP500 index in Oct 2018. SJM had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Feb 2018 to Jun 2018) during which period it delivered -12.81%. It is interesting to note that both SJM and SP500 index significantly outperform during months when quarterly/annual results are announced.

Stock market bubbles don't grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception.
-- George Soros

SJM 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 SJM's volatility from 11 Sep, 2018 to 2 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 SJM has significant positive skewness in it's return distribution. This indicates that investors can expect SJM to recover from drawdowns quickly. Which makes SJM 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 SJM. Therefore, SP500 must receive a lower allocation than SJM in your portfolio. SP500 index usually has shorter drawdown period than SJM.

Based on your interest in SJM you may find it interesting to know that PFE, AMZN and CSCO are large caps that have all shown remarkable performance and qualify to be on every investor's watchlist.

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