20.52 -0.3 (-1.44%) Sell

Stop-loss on the minds of X investors as it was among the worst performers

13 min read

UNITED STATES STEEL CORP was among the worst performers on Tuesday. It lost -1.44% to close at 20.52. On a day when the overall market breadth was 35%, it closed higher than 75% of the market. In comparison, the benchmark SP500 index closed today at -0.0004%.

[Themes containing X]

X is currently in a down trend. The current bearish signal has generated a profit of +28.58% for investors in the last three months.


X has been underperforming the SP500 index in recent time, after having outperformed till 1 Mar, 2018. Over the last 2 years 11 months and 7 days, X outperformed the SP500 index on 52% days.

X returned losses on 56% days in the last three months. During this time, it delivered on average -0.5% per day. It delivered it's worst daily return of -8.32%, during this period, on Tuesday, 27 Nov, 2018. There was initially a bullish trend during this period which started on 31 Oct, 2018 and went on till 7 Nov, 2018. The bullish trend returned +15.0% to investors. This was followed by a bearish trend that started on 4 Dec, 2018 and ended on 11 Dec, 2018. This bearish trend lost -14.41% of investor capital.

X had 4 profitable and 8 loss making months over the last year. During the last year, X underperformed SP500 index on monthly return basis. X was also a more risky investment than SP500 index as it's worst month in the last year, Mar 2018, returned -19.12% compared to -7.28% returned by SP500 index in Oct 2018. X had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Oct 2018 to Dec 2018) during which period it delivered -36.39%. It is interesting to note that both X and SP500 index significantly outperform during months when quarterly/annual results are announced.

"Cash combined with courage in a time of crisis is priceless.

X 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 X's volatility from 19 Sep, 2018 to 28 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 14 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that X has significant negative skewness in it's return distribution. This indicates that X is very risky for short-term investment and can significantly underperform for long durations.

Investors trading in X 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 X. Therefore, SP500 must receive a lower allocation than X in your portfolio. SP500 index usually has shorter drawdown period than X.

Based on your interest in X you may find it interesting to know that PFE is a large cap that has shown remarkable performance and deserves to be on every investors' watchlist.

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