17.08 +0.12 (+0.71%) Sell

Profit booking on the minds of STAY investors as it ranks better than it's peers but, has not managed to breakout

13 min read

EXTENDED STAY AMERICA, INC. was among the best performers on Thursday. It returned +0.71% to close at 17.08. It is currently trading -24% below it's 52 week high of 22.52.

[Themes containing STAY]

STAY is currently in a down trend. Over the last three months 2 bearish signals have generated a profit of +9.36% for investors.


STAY has been underperforming the SP500 index in recent time, after having outperformed till 22 Jun, 2018. Over the last 2 years 11 months and 9 days, STAY underperformed the SP500 index on 51% days.

During the last three months STAY was mostly loss making and delivered on average -0.21% per day. It's best return during this period (of +12.9%) was on Thursday, 1 Nov, 2018. While it's worst loss in the same period (of -5.91%) was on Wednesday, 24 Oct, 2018. There was initially a bullish trend during this period which started on 24 Sep, 2018 and went on till 27 Sep, 2018. The bullish trend returned +2.62% to investors. This was followed by a bearish trend that started on 17 Oct, 2018 and ended on 24 Oct, 2018. This bearish trend lost -15.72% of investor capital.

On monthly basis, STAY delivered profits and losses in equal number of months. STAY delivered profits less regularly than SP500 index. STAY was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -18.31% compared to -7.28% returned by SP500 index in Oct 2018. STAY had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year. It is interesting to note that both STAY 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

STAY 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 STAY's volatility from 17 Sep, 2018 to 1 Nov, 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 STAY has significant positive skewness in it's return distribution. This indicates that investors can expect STAY to recover from drawdowns quickly. Which makes STAY 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 STAY. Therefore, SP500 must receive a lower allocation than STAY in your portfolio. STAY usually has shorter drawdown period than the SP500 index.

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

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