TFSL investors herd to book profits while the going is good
13 Dec, 201813 min read
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TFSL is a falling knife that can bleed you if you catch it today. On a longer term basis, investors in TFS FINANCIAL CORP made -0.02% per day. Thursday's performance of -1.78% was a significant underperformance compared to it's daily average.
TFSL showed a up trend over the last 3 months. During this period TFSL grew by +3.7% and saw a maximum drawdown of -8.22%. There was a long signal during this period which returned +5.9%.
TFSL has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 9 days, TFSL underperformed the SP500 index on 51% days.
During the last three months TFSL was mostly profitable and delivered on average +0.07% per day. It's best return during this period (of +3.43%) was on Thursday, 25 Oct, 2018. While it's worst loss in the same period (of -2.34%) was on Wednesday, 26 Sep, 2018. There was initially a bearish trend during this period which started on 24 Sep, 2018 and went on till 27 Sep, 2018. The trend delivered -4.43% losses to investors. This was followed by a bullish trend that started on 28 Nov, 2018 and ended on 3 Dec, 2018. This bullish trend delivered +3.63% to investors.
On monthly basis, TFSL delivered profits and losses in equal number of months. TFSL delivered profits less regularly than SP500 index. TFSL significantly outperformed SP500 index in Nov 2018, when it returned +8.91% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. TFSL had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.
The Stock Market is designed to transfer money from the Active to the Patient.
-- Warren Buffett
TFSL 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 TFSL's volatility from 17 Sep, 2018 to 13 Dec, 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 TFSL 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.
TFSL has more chance of extreme outcomes than the SP500 index. Therefore, TFSL must receive a lower allocation than SP500 in your portfolio. SP500 index usually has shorter drawdown period than TFSL.
Based on your interest in TFSL you may find it interesting to know that LULU is a mid cap that has shown remarkable performance and deserves to be on every investors' watchlist.
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