SKX investors dump it for better alternatives

SKX is a falling knife that can bleed you if you catch it today. On a longer term basis, investors in SKECHERS USA INC made +0.13% per day. Thursday's performance of -3.05% was a significant underperformance compared to it's daily average.

[Themes containing SKX]

Buy-and-Hold investors in SKX experienced a maximum drawdown of -22.02% over the last three months. It lost -13.6% during this strong down trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals.

Trend

Monthly Performance

Alpha (outperformance)

Heatmap

Volatility

Return distribution

SKX has been underperforming the SP500 index in recent time, after having outperformed till 29 Feb, 2016. Over the last 2 years 11 months and 9 days, SKX underperformed the SP500 index on 48% days. Which indicates that on days SKX underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months SKX was mostly loss making and delivered on average -0.19% per day. It's best return during this period (of +13.78%) was on Friday, 19 Oct, 2018. While it's worst loss in the same period (of -6.15%) was on Friday, 7 Dec, 2018. There was initially a bearish trend during this period which started on 1 Oct, 2018 and went on till 5 Oct, 2018. The trend delivered -6.83% losses to investors. This was followed by a bullish trend that started on 25 Oct, 2018 and ended on 6 Nov, 2018. This bullish trend delivered +13.2% to investors.

SKX had 5 profitable and 7 loss making months over the last year. During the last year, SKX underperformed SP500 index on monthly return basis. SKX was also a more risky investment than SP500 index as it's worst month in the last year, Apr 2018, returned -25.16% compared to -7.28% returned by SP500 index in Oct 2018. SKX had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Feb 2018 to Apr 2018) during which period it delivered -30.78%. It is interesting to note that both SKX and SP500 index significantly outperform during months when quarterly/annual results are announced.

The art and culture that is New York, communications, finance, all these things help make up New York. The rest of the country should be happy that we are what we are.
-- David Dinkins

SKX 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 SKX's volatility from 14 Sep, 2018 to 22 Oct, 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 SKX 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.

Investors trading in SKX derivatives at this moment can consider 'Bear Put Spread' options strategy to receive better risk-adjusted returns.

SP500 index has more chance of extreme outcomes than SKX. Therefore, SP500 must receive a lower allocation than SKX in your portfolio. SP500 index usually has shorter drawdown period than SKX.

Based on your interest in SKX you may find it interesting to know that LOGM and CBPO have both performed similar to SKX and can be considered by investors as alternative investment options.