89.13 -1.39 (-1.56%) Buy

XLNX investors herd to book profits while the going is good

13 min read

XILINX INC was among the worst performers on Thursday. It fell by -1.56% to close at 89.13. On a day when the overall market breadth was 35%, it closed higher than 11% of the market. In comparison, the benchmark SP500 index closed today at -0.0002%.

[Themes containing XLNX]

XLNX showed a strong bullish trend over the last 3 months. During this period XLNX surged by +14.9% and saw a maximum drawdown of -16.05%. There were 2 long signals during this period that returned a cumulative of +10.05% to investors.


XLNX has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 10 May, 2016 to 3 Dec, 2018. Over the last 2 years 11 months and 9 days, XLNX outperformed the SP500 index on 54% days.

XLNX was profitable on 53% days in the last three months. During this time, it delivered on average +0.27% per day. It delivered it's best daily return of +15.01%, during this period, on Thursday, 25 Oct, 2018. The longest stort-term trend during this period was 4 profitable days, which started on 13 Nov, 2018 and went on till 16 Nov, 2018. This bullish trend returned +9.69% to investors.

During the last year XLNX had 8 profitable months and 4 loss making months. Profitable number of months of XLNX and SP500 index were the same. XLNX significantly outperformed SP500 index in Jul 2018, when it returned +9.8% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. XLNX had a shorter streak of profitable months than SP500 index. It only went up in 5 straight months during the last year. It is interesting to note that both XLNX and SP500 index significantly outperform during months when quarterly/annual results are announced.

Here's my gift-giving rule: Respect your current financial situation.
-- Suze Orman

XLNX 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 XLNX's volatility from 17 Sep, 2018 to 31 Oct, 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 XLNX has significant positive skewness in it's return distribution. This indicates that investors can expect XLNX to recover from drawdowns quickly. Which makes XLNX a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

Investors trading in XLNX derivatives at this moment can consider 'Covered Call' options strategy to receive better risk-adjusted returns.

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

On a general note (since you are interested in XLNX), three instruments that deserve special mention are AYTU, APRN and ~SMALLCAP. They have all outperformed the market and must be closely watched for investment opportunities.

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