43.5 -0.6 (-1.38%) Sell

Don't buy ST now, it is an investor's nightmare

13 min read

SENSATA TECHNOLOGIES HOLDING PLC ranked among the worst performers today. It lost -1.38% to close at 43.5. It's recent 5 day performance has been -0.27%, -3.47%, +0.35%, -4.44% and +3.29%.

[Themes containing ST]

ST showed a strong down trend over the last 3 months. During this period ST lost -15.71% and saw a maximum drawdown of -21.91%. There were 2 short signals during this period that returned a cumulative of +10.5% to investors.


ST has been underperforming the SP500 index in recent time, after having outperformed till 4 Jan, 2016. Over the last 2 years 11 months and 7 days, ST underperformed the SP500 index on 48% days. Which indicates that on days ST underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

ST returned losses on 59% days in the last three months. During this time, it delivered on average -0.25% per day. It delivered it's best daily return of +10.99%, during this period, on Tuesday, 30 Oct, 2018. There was initially a bullish trend during this period which started on 18 Sep, 2018 and went on till 21 Sep, 2018. The bullish trend returned +4.13% to investors. This was followed by a bearish trend that started on 24 Sep, 2018 and ended on 12 Oct, 2018. This bearish trend lost -17.31% of investor capital.

ST had 3 profitable and 9 loss making months over the last year. During the last year, ST underperformed SP500 index on monthly return basis. ST significantly outperformed SP500 index in Jul 2018, when it returned +12.15% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ST had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Aug 2018 to Dec 2018) during which period it delivered -21.4%. It is interesting to note that both ST and SP500 index significantly outperform during months when quarterly/annual results are announced.

There's more honor in investment management than in investment banking.
-- Charlie Munger

ST 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 ST's volatility from 13 Sep, 2018 to 30 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 ST 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 ST. Therefore, SP500 must receive a lower allocation than ST in your portfolio. SP500 index usually has shorter drawdown period than ST.

Based on your interest in ST you may find it interesting to know that HEAR, I and NIHD have all shown remarkable performance this year and deserve to be on every investor's watchlist.

Want to improve your Portfolio's performance?

Spotalpha's Portfolio optimizer is all you need to improve your returns and reduce your risk.
Optimize Portfolio NOW
Symbol Price {{retType}} | Tr.
{{detail.symbol}} {{detail.close}} {{detail.priceChange}}  {{detail.pctChange}}%  {{}} {{detail.trend}} 
If you liked what you read here ...

... we have a small favour to ask. Help us bring the power of algorithmic trading strategies to individual investors.

All content in this article was automatically generated by algorithms. This ensures that there are no human biases in the analysis provided. This approach to investing is not new and has been around for more than three decades. Yet, it has been available to only the most affluent or elite investors leaving individual investors to trade on emotions (such as fear and greed), intuition and poor analysis from third-parties. We want to change this.

We want to empower investors with all the tools and analysis required by them to make a rational investment decision.

If you found Spotalpha useful, consider making a contribution. For as little as $5 you can support our efforts and it takes less than a minute. Thank you. Contribute
Share with friends   WhatsApp   Facebook   Twitter