SCHWEITZER MAUDUIT INTERNATIONAL INC

26.91 +0.23 (+0.86%) Sell

Don't lose faith in SWM now, it delivered good returns

13 min read

SCHWEITZER MAUDUIT INTERNATIONAL INC was among the best performers today. It returned +0.86% to close at 26.91. It's recent 5 day performance has been +0.08%, +0.79%, -1.27%, -1.72% and -1.34%.

[Themes containing SWM]

SWM showed a strong down trend over the last 3 months. During this period SWM returned -35.16% and saw a maximum drawdown of -36.62%. There was a short signal during this period which returned +35.16%.

Trend

SWM has been underperforming the SP500 index in recent time, after having outperformed till 11 Feb, 2016. Over the last 2 years 11 months and 10 days, SWM underperformed the SP500 index on 50% days. Which indicates that on days SWM underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months SWM was mostly loss making and delivered on average -0.67% per day. It's best return during this period (of +4.1%) was on Thursday, 1 Nov, 2018. While it's worst loss in the same period (of -6.05%) was on Tuesday, 4 Dec, 2018. There was initially a bullish trend during this period which started on 15 Oct, 2018 and went on till 17 Oct, 2018. The bullish trend returned +2.65% to investors. This was followed by a bearish trend that started on 15 Nov, 2018 and ended on 27 Nov, 2018. This bearish trend lost -7.04% of investor capital.

On monthly basis, SWM delivered losses in more months over the last year, than profits. SWM delivered profits less regularly than SP500 index. SWM was also a more risky investment than SP500 index as it's worst month in the last year, Feb 2018, returned -13.41% compared to -7.28% returned by SP500 index in Oct 2018. SWM had a longer winning streak of losing months than SP500 index. It went down in 7 straight months (from Jun 2018 to Dec 2018) during which period it delivered -43.01%. It is interesting to note that both SWM and SP500 index significantly outperform during months when quarterly/annual results are announced.

"The real measure of your wealth is how much you'd be worth if you lost all your money

SWM is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in SWM's volatility from 21 Sep, 2018 to 9 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 25 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that SWM has significant positive skewness in it's return distribution. This indicates that investors can expect SWM to recover from drawdowns quickly. Which makes SWM 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 SWM. Therefore, SP500 must receive a lower allocation than SWM in your portfolio. SWM usually has shorter drawdown period than the SP500 index.

On a general note (since you are interested in SWM), two small cap instruments that deserve special mention are PTC and AAXN. They have significantly outperformed the overall market.

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