188.61 -2.09 (-1.11%) Sell

STZ investors dump it for better alternatives

13 min read

CONSTELLATION BRANDS, INC. was among the worst performers today. It lost -1.11% to close at 188.61. It's recent 5 day performance has been -0.24%, -3.55%, +1.25%, -0.23% and -2.54%.

[Themes containing STZ]

STZ is currently in a down trend. Over the last three months trading short signals has not been a profitable strategy for STZ's investors in general. However, this strategy had significantly lower risk when compared to Buy-and-Hold investing (which returned -11.06%). It is therefore better to tread with caution in the current downtrend by limiting your allocation to STZ.


STZ has been underperforming the SP500 index in recent time, after having outperformed till 30 Apr, 2018. Over the last 2 years 11 months and 3 days, STZ outperformed the SP500 index on 53% days.

STZ returned losses on 59% days in the last three months. During this time, it delivered on average -0.18% per day. It delivered it's best daily return of +5.38%, during this period, on Thursday, 4 Oct, 2018. There was initially a bullish trend during this period which started on 17 Sep, 2018 and went on till 20 Sep, 2018. The bullish trend returned +3.04% to investors. This was followed by a bearish trend that started on 18 Oct, 2018 and ended on 24 Oct, 2018. This bearish trend lost -6.79% of investor capital.

STZ had 3 profitable and 9 loss making months over the last year. During the last year, STZ underperformed SP500 index on monthly return basis. STZ was also a less risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -6.61% compared to -7.28% returned by SP500 index in Oct 2018. STZ had a longer winning streak of losing months than SP500 index. It went down in 4 straight months (from May 2018 to Aug 2018) during which period it delivered -9.8%.

I hate weekends because there is no stock market.
-- Rene Rivkin

STZ 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 STZ's volatility from 3 Oct, 2018 to 29 Oct, 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 STZ 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 STZ 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 STZ. Therefore, SP500 must receive a lower allocation than STZ in your portfolio. SP500 index usually has shorter drawdown period than STZ.

On a general note (since you are interested in STZ), three instruments that deserve special mention are TYHT, EPIX and AMRH. They have all outperformed the market and must be closely watched for investment opportunities.

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