28.14 -1.81 (-6.42%) Sell

Stop-loss on the minds of WLL investors as it delivered massive losses

13 min read

WHITING PETROLEUM CORP was among the worst performers on Friday. It lost -6.42% to close at 28.14. It is currently trading -49% below it's 52 week high of 55.46.

[Themes containing WLL]

WLL is currently in a down trend. Over the last three months 2 bearish signals have generated a profit of +23.78% for investors.


WLL has been underperforming the SP500 index in recent time, after having outperformed till 7 Jun, 2016. Over the last 2 years 11 months and 10 days, WLL underperformed the SP500 index on 50% days. Which indicates that on days WLL underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months WLL was mostly loss making and delivered on average -0.75% per day. It's best return during this period (of +6.31%) was on Monday, 3 Dec, 2018. While it's worst loss in the same period (of -8.87%) was on Tuesday, 20 Nov, 2018. There was initially a bearish trend during this period which started on 4 Oct, 2018 and went on till 11 Oct, 2018. The trend delivered -22.76% losses to investors. This was followed by a bullish trend that started on 26 Nov, 2018 and ended on 29 Nov, 2018. This bullish trend delivered +4.55% to investors.

WLL had 7 profitable and 5 loss making months over the last year. During the last year, WLL underperformed SP500 index on monthly return basis. WLL was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -31.57% compared to -7.28% returned by SP500 index in Oct 2018. WLL had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.

If you would be wealthy, think of saving as well as getting.
-- Benjamin Franklin

WLL 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 WLL's volatility from 27 Sep, 2018 to 2 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 WLL 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 WLL 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 WLL. Therefore, SP500 must receive a lower allocation than WLL in your portfolio. SP500 index usually has shorter drawdown period than WLL.

On a general note (since you are interested in WLL), two instruments that have been extremely volatile in recent times are IX and ICPT. Investors in these instruments should consider reducing their exposure (to IX and ICPT) and diversifying their portfolios.

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