WBS investors hold onto their investments as it marginally outperforms
17 Dec, 201813 min read
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WEBSTER FINANCIAL CORP delivered good returns today. It grew by +0.42% to close at 50.57. It's recent 5 day performance has been -1.51%, -3.64%, +0.86%, -1.99% and -1.05%.
WBS is currently in a down trend. Over the last three months 3 bearish signals have generated a profit of +7.39% for investors.
WBS has been underperforming the SP500 index in recent time, after having outperformed till 23 Jul, 2018. Over the last 2 years 11 months and 10 days, WBS outperformed the SP500 index on 51% days.
During the last three months WBS was mostly loss making and delivered on average -0.31% per day. It's best return during this period (of +4.26%) was on Wednesday, 3 Oct, 2018. While it's worst loss in the same period (of -6.32%) was on Tuesday, 4 Dec, 2018. There was initially a bullish trend during this period which started on 29 Oct, 2018 and went on till 2 Nov, 2018. The bullish trend returned +2.6% to investors. This was followed by a bearish trend that started on 3 Dec, 2018 and ended on 11 Dec, 2018. This bearish trend lost -13.13% of investor capital.
On monthly basis, WBS delivered profits in more months over the last year, than losses. WBS delivered profits less regularly than SP500 index. WBS was also a more risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -16.3% compared to -7.28% returned by SP500 index in Oct 2018. WBS 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 WBS and SP500 index significantly outperform during months when quarterly/annual results are announced.
Empty pockets never held anyone back. Only empty heads and empty hearts can do that.
-- Norman Vincent Peale
WBS 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 WBS's volatility from 25 Sep, 2018 to 24 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 WBS has significant positive skewness in it's return distribution. This indicates that investors can expect WBS to recover from drawdowns quickly. Which makes WBS a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.
WBS has more chance of extreme outcomes than the SP500 index. Therefore, WBS must receive a lower allocation than SP500 in your portfolio. SP500 index usually has shorter drawdown period than WBS.
Based on your interest in WBS you may find it interesting to know that SQ, RHT and ABMD are mid caps that have all shown remarkable performance and qualify to be on every investor's watchlist.
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