94.54 +2.69 (+2.85%) Sell

TXN does a dead cat bounce, it's still too early to buy into it

13 min read

TEXAS INSTRUMENTS INC outperformed today. It surged by +2.85% to close at 94.54. It's recent 5 day performance has been -2.48%, -1.65%, +0.03%, +1.34% and +0.79%.

[Themes containing TXN]

TXN is currently in a bearish trend. The current bearish signal has generated a profit of +11.95% for investors in the last three months.


TXN has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 15 Jan, 2016 to 17 Jan, 2018. Over the last 2 years 11 months and 14 days, TXN outperformed the SP500 index on 56% days.

TXN returned losses on 51% days in the last three months. During this time, it delivered on average -0.18% per day. It delivered it's worst daily return of -8.22%, during this period, on Wednesday, 24 Oct, 2018. The longest stort-term trends during this period were 4 profitable and losing days. The bullish trend (which returned +2.1%) started on 27 Sep, 2018 and went on till 2 Oct, 2018 while the bearish trend (which returned -6.16%) started on 3 Oct, 2018 and went on till 8 Oct, 2018.

During the last year TXN had 6 profitable months and 6 loss making months. TXN returned profits in fewer months than SP500 index. TXN was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -13.84% compared to -7.75% returned by SP500 index in Dec 2018. TXN had a shorter streak of profitable months than SP500 index. It only went up in 2 straight months during the last year. It is interesting to note that both TXN and SP500 index significantly outperform during months when quarterly/annual results are announced.

"There is a huge amount of freedom that is derived from not fighting the market.

TXN is currently seeing overall fall in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in TXN's volatility from 21 Sep, 2018 to 29 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 19 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that TXN has significant positive skewness in it's return distribution. This indicates that investors can expect TXN to recover from drawdowns quickly. Which makes TXN a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

Investors trading in TXN derivatives at this moment can consider 'Protective Collar' options strategy to receive better risk-adjusted returns.

SP500 index has more chance of extreme outcomes than TXN. Therefore, SP500 must receive a lower allocation than TXN in your portfolio. SP500 index usually has shorter drawdown period than TXN.

Based on your interest in TXN you may find it interesting to know that RGSE has shown remarkable performance and deserves to be on every investors' watchlist.

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